Crypto Banking Restrictions Rescinded in US: What Changed in 2025

Crypto Banking Restrictions Rescinded in US: What Changed in 2025

Crypto Banking Compliance Checker

Check if your bank's crypto service complies with the new 2025 US regulatory framework. Select your service type and details to see if it's permitted under current rules.

For years, U.S. banks were stuck in a gray zone when it came to crypto. If they wanted to offer custody services, hold stablecoins, or run blockchain nodes, they had to jump through hoops-submitting advance notices, waiting for regulatory approval, and proving they had enough controls in place. It wasn’t just slow. It was a deterrent. Many banks just said no. But on April 24, 2025, everything changed.

What Got Removed in 2025?

The Federal Reserve, the Office of the Comptroller of the Currency (OCC), and the FDIC didn’t just tweak rules-they erased them. Three major restrictions vanished overnight.

  • SR 22-6 (2022): This required state member banks to notify the Fed before doing any crypto-related work. No more. Banks can now start crypto services without a heads-up.
  • SR 23-8 (2023): This forced banks to get formal approval before handling dollar-backed stablecoins. That process is gone. No more waiting months for a regulatory green light.
  • FIL-16-2022 (FDIC): This rule told FDIC-insured banks they needed prior approval for any crypto activity. Now, as long as they manage risk properly, they’re free to act.

The OCC also killed Interpretive Letter 1179 from 2021, which had told national banks they couldn’t custody crypto without special permission. In its place, Interpretive Letter 1183 says clearly: Yes, you can custody Bitcoin, Ethereum, and stablecoins. Yes, you can run independent blockchain nodes. Yes, you can hold reserves for tokenized assets. No extra paperwork. No special requests.

Why Did This Happen Now?

The Biden administration’s crypto stance from 2021 to 2024 was built on caution. After the Terra-Luna collapse and FTX’s implosion, regulators panicked. They treated every crypto activity like a ticking bomb. But by 2025, the landscape had changed.

Banks had spent years building internal systems. Compliance teams got smarter. Cybersecurity protocols improved. Stablecoins like USDC and USDT proved they could operate safely at scale. Meanwhile, competitors overseas-Switzerland, Singapore, even parts of the EU-were pulling ahead in crypto banking innovation.

The regulators realized their rules weren’t protecting the system. They were just keeping American banks out of it. The OCC put it bluntly: "Our supervisory non-objection process is no longer necessary." They had seen enough. They trusted the industry to do the right thing-with oversight, not permission.

What Can Banks Do Now?

Under the new rules, U.S. banks can legally do the following without asking for permission:

  • Hold customer crypto assets in cold storage (custody services)
  • Issue, redeem, or hold reserves for dollar-backed stablecoins
  • Participate in public blockchain networks as validating nodes
  • Provide crypto on-ramp/off-ramp services (buy/sell crypto with USD)
  • Offer crypto interest accounts or staking services (if structured as non-deposit products)

These aren’t theoretical. JPMorgan, Wells Fargo, and State Street have all quietly tested these services over the past year. Now, they can roll them out nationwide without regulatory delays.

Regulatory icons tossing old crypto rules into a trash can as bankers celebrate.

What’s Still Off Limits?

Don’t get it twisted. This isn’t a free-for-all. The regulators didn’t remove all rules-they just removed the red tape.

Here’s what’s still restricted:

  • Direct crypto holdings on balance sheets: Banks still can’t buy Bitcoin or Ethereum as investments. Only stablecoins tied to U.S. dollars are allowed as reserves.
  • Crypto lending: If a bank wants to lend crypto directly (like a peer-to-peer loan), they’re still in uncharted territory. No clear guidance exists yet.
  • Decentralized finance (DeFi) protocols: Interacting with smart contracts on Uniswap or Aave? That’s still a compliance minefield. Regulators haven’t clarified how banks should handle these.
  • Non-stablecoin tokens: No bank can legally hold Solana, Cardano, or Dogecoin as an asset. Only USD-pegged tokens are permitted.

These gaps aren’t accidents. Regulators are waiting. They’re watching how banks handle the new freedoms before writing rules for the next wave.

How This Changes the Game

Before 2025, crypto banking was a niche play. Only a handful of fintechs like Coinbase and Kraken offered it-and they weren’t banks. Now, the biggest financial institutions in the world can enter the space overnight.

Think about it: A customer walks into their local Chase branch and asks, "Can I buy Bitcoin here?" Five years ago, the answer was no. Today, the answer is yes-and they can do it through their existing app, with FDIC insurance on the USD portion, and under the same compliance rules as wire transfers.

This isn’t just convenience. It’s legitimacy. When your bank offers crypto, it stops feeling like a gamble. It feels like part of your financial life.

Smaller banks and credit unions are also catching up. With clear federal rules, they no longer need to fear state regulators stepping in. A community bank in Ohio can now offer crypto custody without worrying about conflicting state laws.

Small Ohio bank with customers buying crypto under a glowing sunset sky.

What’s Next?

The agencies have said they’ll keep working with the President’s Working Group on Digital Asset Markets to fill the remaining gaps. That means more rules are coming-but they’ll be targeted, not restrictive.

Expect guidance soon on:

  • How banks can safely lend crypto without exposing depositors to risk
  • What counts as a "permissible" DeFi interaction
  • Whether non-stablecoin crypto can ever be held on bank balance sheets

But for now, the biggest hurdle is gone. The permission system is dead. The era of banks asking regulators for approval before doing crypto is over.

What This Means for You

If you’re a customer: Your bank will soon offer crypto services. Watch for updates in your app. You might see new options like "Buy Bitcoin with USD" or "Earn interest on USDC." It’s not a gimmick-it’s the new normal.

If you’re a crypto user: You’re no longer stuck with exchanges that aren’t insured. Your money can now sit in a bank that’s regulated, audited, and backed by the full faith of the U.S. government.

If you’re a developer or fintech founder: The playing field just leveled. You can now partner with real banks instead of competing against them. Integration is easier. Compliance is clearer. The door is open.

The 2025 crypto banking changes aren’t about hype. They’re about reality. The regulators stopped fearing innovation. They started trusting it.

22 Comments

  • Image placeholder

    Ankit Varshney

    December 5, 2025 AT 15:19

    This is huge. For years, Indian fintechs have been watching U.S. banks sit on the sidelines while we built real crypto infrastructure. Now the U.S. is catching up-not because of hype, but because they finally stopped treating innovation like a crime.

  • Image placeholder

    Ann Ellsworth

    December 5, 2025 AT 22:36

    Let’s be real-the regulators didn’t ‘trust’ anyone. They got scared of losing relevance. The EU’s MiCA framework already outclassed this half-baked ‘permissionless’ nonsense. Now they’re scrambling to appear competitive while still clinging to dollar hegemony. Pathetic.

  • Image placeholder

    Ziv Kruger

    December 7, 2025 AT 09:08

    What does it mean when the state stops saying ‘no’ and starts saying ‘do it, but don’t screw up’? That’s not deregulation. That’s a philosophical shift from control to responsibility. The bank isn’t a child anymore. It’s an adult with a gun and a balance sheet.

  • Image placeholder

    Heather Hartman

    December 7, 2025 AT 17:10

    Yessss!! This is the kind of progress I’ve been waiting for. My cousin in Ohio just asked me how to buy USDC through her credit union-finally, it’s not just Silicon Valley anymore. Welcome to the future, America 🙌

  • Image placeholder

    Catherine Williams

    December 9, 2025 AT 08:23

    As a woman in fintech who’s spent a decade begging banks to take crypto seriously, I’m crying. Not because it’s perfect-but because it’s possible. To every young developer reading this: build. The gatekeepers just opened the door.

  • Image placeholder

    Paul McNair

    December 10, 2025 AT 03:28

    From Lagos to Lahore, we’ve watched this dance for years. The U.S. always says ‘wait until we’re ready.’ Today, they finally admitted they were never ready-they were just afraid. Good. Now let’s see if they can handle the responsibility.

  • Image placeholder

    Andrew Brady

    December 10, 2025 AT 23:26

    Mark my words-this is the first step toward a central bank digital currency. They’re letting banks play with crypto to normalize it, then they’ll force everyone onto the FedNow blockchain. This isn’t freedom. It’s a trap.

  • Image placeholder

    Sharmishtha Sohoni

    December 12, 2025 AT 17:25

    Stablecoins only? So no ETH? Then what’s the point? This feels like letting someone play with a toy car while banning bicycles.

  • Image placeholder

    Althea Gwen

    December 13, 2025 AT 04:27

    YASSS QUEEN 💅✨ finally the banks are catching up to what we’ve been doing on Coinbase since 2021. I’m so proud. My portfolio just got a hug from the federal government 😭❤️

  • Image placeholder

    Durgesh Mehta

    December 14, 2025 AT 17:16

    Good move. Now if only they’d clarify DeFi. A lot of us are waiting to build integrations but can’t risk it without clear rules. Hope they move fast.

  • Image placeholder

    Jess Bothun-Berg

    December 14, 2025 AT 22:51

    Oh please. You think this is progress? Banks still can’t hold Bitcoin. They’re still scared of real crypto. This is window dressing. They want you to think you’re free while they keep the real assets locked down. Pathetic.

  • Image placeholder

    Steve Savage

    December 16, 2025 AT 09:54

    Look, I used to think crypto was a fad. Then I saw how many small businesses in rural areas are using USDC to pay suppliers without waiting 3 days for ACH. This isn’t about tech. It’s about fairness. The system finally caught up to real people.

  • Image placeholder

    Joe B.

    December 17, 2025 AT 22:24

    Let’s break this down statistically. 78% of crypto custody volume in 2024 was handled by non-bank entities. Even with these new rules, the top 5 banks will still only capture 12% of the market by end of 2026. This is theater. The real innovation is happening in Layer 2 protocols and private chains-none of which these banks can touch without legal counsel on speed dial. The ‘freedom’ is an illusion. The infrastructure gap is widening. They’re not leading-they’re begging for relevance.

  • Image placeholder

    Rod Filoteo

    December 18, 2025 AT 07:13

    They’re letting banks do crypto because they know the Fed’s gonna force everyone into CBDC next year. This is a test run. They’re training the public to trust banks with digital assets… so when they replace your dollars with digital tokens you can’t spend on Amazon, you won’t scream. They’re not liberalizing-they’re preparing for total control. Wake up.

  • Image placeholder

    Nora Colombie

    December 19, 2025 AT 00:59

    How dare they let banks touch crypto? This is a betrayal of American sovereignty. The Chinese are laughing. The Russians are laughing. And now our banks are handing over financial control to some anonymous blockchain? This is how empires fall.

  • Image placeholder

    Greer Dauphin

    December 20, 2025 AT 04:15

    So… you’re telling me I can now buy Bitcoin through my Chase app? Cool. But can I still withdraw it to my Ledger? Or is that ‘too risky’? 😏

  • Image placeholder

    Bhoomika Agarwal

    December 21, 2025 AT 04:19

    USA finally woke up… 7 years late. Meanwhile, India’s RBI quietly approved crypto exchanges with KYC-AML baked in. We didn’t need permission-we just did it. Now you’re playing catch-up with a limp. Respect.

  • Image placeholder

    Katherine Alva

    December 22, 2025 AT 20:05

    It’s beautiful. The moment you stop fearing innovation and start trusting responsibility-that’s when civilization grows. This isn’t about crypto. It’s about whether we still believe in human potential. 🌱

  • Image placeholder

    Christy Whitaker

    December 23, 2025 AT 20:15

    Of course they did this. They know people are leaving banks for DeFi. Now they’re trying to lure them back with a sugar-coated prison. Don’t be fooled. The moment you deposit crypto, you’re giving them control over your money. Again.

  • Image placeholder

    Mohamed Haybe

    December 24, 2025 AT 10:24

    They removed the rules so they can blame someone later. This isn’t progress-it’s a liability shield. When the next crash hits, they’ll say ‘we warned you’ while quietly bailing out the banks. Classic.

  • Image placeholder

    Marsha Enright

    December 25, 2025 AT 00:02

    For anyone nervous about this: start small. Try USDC staking through your bank. It’s not risky if you treat it like a savings account. And if you’re a beginner-ask your branch rep. Most don’t know how it works yet. You’ll be ahead of 90% of customers.

  • Image placeholder

    Sarah Roberge

    December 26, 2025 AT 02:43

    Wow. So now banks can custody crypto… but you still can’t use it to buy coffee? What a joke. This isn’t financial freedom. It’s a corporate PR stunt with a blockchain filter. I’m not impressed.

Write a comment