Crypto Banking Restrictions Rescinded in US: 2025 Changes

What Changed in US Crypto Banking in 2025?

For years, American banks were stuck in a regulatory gray zone when it came to cryptocurrency. If you wanted to offer crypto custody, hold stablecoins, or run a node on a blockchain network, you had to jump through hoops-submitting detailed notices, waiting months for approval, and proving you had enough controls in place just to do what other banks did every day with cash or stocks. That all changed on April 24, 2025, when the Federal Reserve, the Office of the Comptroller of the Currency (OCC), and the Federal Deposit Insurance Corporation (FDIC) quietly but decisively rescinded nearly all of the Biden-era restrictions on crypto banking.

The Old Rules That Held Banks Back

Before 2025, banks had to follow three major rules that made crypto services nearly impossible to offer at scale. First, under SR 22-6 from 2022, state member banks had to notify the Federal Reserve before even thinking about offering crypto services. Second, SR 23-8 in 2023 required banks to get formal approval before handling dollar-denominated tokens like USDC or USDT. Third, the OCC’s Interpretive Letter 1179 from 2021 had effectively blocked national banks from offering crypto custody unless they got special permission.

These weren’t just paperwork hurdles. They created fear. Banks didn’t know how long approval would take-some waited over a year. Others gave up entirely. Even big institutions like JPMorgan and Bank of America avoided crypto services not because they didn’t want to, but because the regulatory risk outweighed the reward. The FDIC’s FIL-16-2022 added another layer, forcing insured banks to report any crypto activity before doing it. The result? A banking system that stayed out of crypto while fintech startups and crypto-native firms filled the gap.

The 2025 Regulatory Reset

By March 2025, the tide turned. The OCC led the charge with Interpretive Letter 1183, which officially scrapped Interpretive Letter 1179. The message was clear: national banks and federal savings associations can now custody crypto, hold stablecoin reserves, and participate in blockchain node networks without asking for permission. The OCC said their staff now understands the tech well enough to supervise it through regular exams-not special approvals.

The FDIC followed on March 28, 2025, saying supervised institutions no longer need prior approval for crypto activities as long as they manage risk properly. That means banks can now offer crypto wallets, custody, and stablecoin settlement services without waiting for a regulator’s green light. Then, on April 24, the Federal Reserve pulled the plug on SR 22-6 and SR 23-8. No more advance notice. No more non-objection requests. Just normal banking supervision.

Along with these changes, all three agencies withdrew two key joint statements from early 2023 that had painted crypto as inherently risky. Those statements had been used to justify the strict rules. Their removal wasn’t just symbolic-it removed the legal basis for treating crypto differently from other assets.

What Banks Can Do Now

With the old rules gone, banks can legally offer several crypto services without jumping through hoops:

• Crypto custody - Holding Bitcoin, Ethereum, or other tokens for customers, just like they hold stocks or bonds.
• Stablecoin reserves - Holding USDC, USDT, or other dollar-backed tokens as part of customer accounts or payment systems.
• Node participation - Running nodes on public blockchains like Ethereum or Bitcoin to verify transactions.
• Crypto-enabled payments - Processing payments using stablecoins between businesses or individuals.

Importantly, these services are now treated like any other banking activity. If a bank wants to offer mobile banking, it doesn’t need to ask permission. Same goes for crypto now. The regulators aren’t saying crypto is safe-they’re saying banks are capable of managing the risk themselves, and that’s enough.

What’s Still Not Allowed (Yet)

Don’t get the wrong idea. This wasn’t a full green light for everything crypto. Banks still can’t:

• Hold non-stablecoin crypto-assets (like Bitcoin or Ethereum) on their own balance sheets as investments.
• Lend crypto directly to customers (no crypto loans or margin trading).
• Offer crypto derivatives or futures through traditional banking channels.

These gaps remain because regulators are still working on them. The Federal Reserve, OCC, and FDIC have said they’re collaborating with the President’s Working Group on Digital Asset Markets to draft new guidance. That means more rules could come later-but for now, the biggest barriers are gone.

Why This Matters for You

If you’re a regular bank customer, this change means you’ll soon see crypto services popping up in your online banking app. Big banks like Wells Fargo, Citibank, and PNC are already preparing to launch crypto wallets and stablecoin transfers. You won’t need to sign up with Coinbase or Kraken-you’ll be able to buy Bitcoin or send USDC directly from your checking account.

For small businesses, this could mean faster, cheaper payments. Stablecoins settled on blockchain can clear in seconds, not days. No more waiting for ACH transfers or paying high fees to PayPal. Banks can now offer that as a built-in feature.

And for crypto startups, this is a game-changer. Instead of partnering with offshore banks or struggling to find a banking partner, they can now work with American institutions that have full legal backing. That means more innovation, more competition, and better services for everyone.

The Bigger Picture

This isn’t just about crypto. It’s about how regulators think about technology. For four years, the U.S. treated digital assets like a dangerous experiment. Now, they’re treating them like a tool-something that can be used safely if managed properly. The shift reflects a growing understanding that blockchain isn’t going away, and trying to stop banks from engaging with it only pushes innovation overseas.

Other countries are already moving faster. The EU passed its MiCA framework in 2024. Singapore and Switzerland have clear rules for crypto banking. The U.S. was falling behind. The 2025 changes are a correction, not a revolution. But it’s a big one.

What Comes Next?

Expect a wave of new crypto services from traditional banks in 2025 and 2026. You’ll likely see:

• Stablecoin deposits with interest (like savings accounts but in USDC).
• Instant cross-border payments using crypto rails.
• Integrated crypto buying and selling inside mobile banking apps.
• Business accounts that accept crypto as payment and auto-convert to USD.

Regulators will keep an eye on fraud, money laundering, and market stability. But they’re no longer trying to block the door-they’re opening it, and asking banks to walk through responsibly.