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Fed’s Crypto Guidance Withdrawal Sparks Skepticism
On April 24, the U.S. Federal Reserve withdrew its 2022 supervisory letter that had discouraged banks from engaging with crypto and stablecoin activities. While many in the crypto industry, including Michael Saylor and Anthony Pompliano, hailed this as a positive development, Senator Cynthia Lummis expressed strong skepticism.
Lummis Questions Fed’s Commitment to Crypto Integration
Senator Lummis, a known advocate for cryptocurrency and the sponsor of the Bitcoin Strategic Reserve Bill introduced in July 2024, criticized the Fed’s move as superficial. She argued that the withdrawal does not signify real progress, stating that the Fed continues to “illegally flout the law on master accounts” and still relies on reputational risk in its bank supervision practices.
Concerns Over Ongoing Anti-Crypto Sentiment
Lummis highlighted that the Fed’s policy statement in Section 9(13), which labels Bitcoin and digital assets as “unsafe and unsound,” remains in place. She also pointed out that many of the same staff involved in “Operation Chokepoint 2.0” are still shaping crypto policy today. Lummis emphasized that the fight for fair treatment of the digital asset industry is far from over.
Mixed Reactions Within the Crypto Community
While Lummis and Custodia Bank founder Caitlin Long share concerns about the Fed’s approach, other crypto executives view the withdrawal as a step forward. Anastasija Plotnikova, co-founder and CEO of blockchain regulatory firm Fideum, remarked that the decision simplifies the path to institutional adoption.
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