The United States Federal Reserve is broadening the scope of its supervision program which oversees U.S. banks that engage with the cryptocurrency and blockchain industry.
An Aug. 8 announcement by the Federal Reserve Board established the Novel Activities Supervision Program which aims to limit certain crypto-related activities and facilitate a more fair playing field for banks involved with servicing the digital asset industry.
The program is an additional measure to the Board’s Jan. 27 policy statement that aims to ensure all Fed-supervised banks are subject to the same crypto-related limitations.
@federalreserve provides additional information on its program to supervise novel activities in the banks it oversees: https://t.co/6MiItQwO7V
— Federal Reserve (@federalreserve) August 8, 2023
Activities regulated under the program include the custody, lending, trading, issuance or distribution of crypto including stablecoins.
Providing banking infrastructure to digital asset firms or working with companies that use distributed ledger technologies is also regulated, according to a letter from the Board.
The Fed said the objective of the novel activities program is to balance financial innovation with appropriate risk management practices to ensure the safety and soundness of the banking system.
