The United States is redefining its financial strategy with crypto. The Financial Services Council (FSOC) has aligned itself with the Federal Reserve, removing key restrictions, promoting the integration of cryptocurrencies into banking, and supporting the GENIUS Act.
Following the Federal Reserve's recent move to dismantle restrictions on banks interested in trading digital assets, the Treasury's Financial Stability Oversight Council (FSOC) has confirmed this new direction. Its 2025 annual report marks not only a change in rhetoric but a pragmatic shift: federal institutions have moved away from viewing cryptocurrencies as an existential threat and are now beginning to treat them as an inevitable component of the modern banking system.
This change in stance represents a decisive victory for the crypto industry, which for years has operated under the shadow of regulatory uncertainty and the veiled hostility of the so-called "Operation Choke Point 2.0"However, the current FSOC report acts as the formal closure of that stage.
By aligning with the Fed's decision to withdraw the restrictive guidelines of 2023The Treasury Department, which had previously restricted native crypto banks from operating within the regulated financial system, is sending a message of unity to Wall Street. It is now signaling that the de facto ban on cryptocurrencies is over and that a new era of supervised integration is beginning.
Trade cryptocurrencies with Bit2MeThe FSOC celebrates regulatory clarity for crypto with the GENIUS Act
At the heart of this regulatory transformation is the GENIUS Act. This legislation, championed by President Donald Trump's administration, establishes a specific federal framework for issuers of payment stablecoins. report 2025 the FSOC considers this standard a key source of clarity that promotes innovation in stablecoins within the United States and, at the same time, reduces risks to financial stability.
In previous editions, the FSOC used its reports to warn of contagion risks and bank runs triggered by volatile digital assets. However, the tone of its 2025 report is drastically different. The organization now acknowledges that The GENIUS Act has mitigated structural risks by imposing strict requirements on reserves, audits, and transparency. Thanks to this legislative safety net, the regulator's approach has evolved from alarmist containment to proactive management.
This new regulatory clarity has allowed federal banking agencies, in coordination with the FSOC, to dismantle previous bureaucratic barriers. Joint declarations that discouraged banks from holding crypto assets have been eliminated, and the requirement to obtain prior supervisory no-objection for certain basic transactions has been removed.
Now, the guideline is that banks can interact with the digital economy as long as they meet compliance standards, transforming cryptocurrencies from a toxic asset into a legitimate line of business under federal supervision.
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Perhaps the most revealing aspect of the report is how the FSOC has reassessed the narrative surrounding the security and illicit use of cryptocurrencies. In contrast to its defensive stance in 2024, the Treasury now admits that The use of blockchain for illegal activities represents a negligible fraction of the total transaction volumeThe document emphasizes that the vast majority of capital flows in these networks are legitimate trade, technological innovation, and legitimate value transfers.
Overall, this adjustment directly benefits traditional banking. By allaying concerns about criminal risks, the FSOC paves the way for major custodians and investment banks to actively participate in the crypto space without the burden of potential reputational damage.
Now, regulators are approving and promoting the integration between the conventional financial system and the crypto-asset ecosystem, with the aim of boosting the efficiency of the dollar in digital environments.
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