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Bitcoin and other major cryptocurrencies climbed Thursday night after the Federal Reserve Board (FRB) announced that guidance for banks related to crypto and stablecoin activities was being move comes just weeks after the Federal Deposit Insurance Corporation (FDIC) made a similar announcement, giving more leeway for banks across the country to engage with the crypto opens a path for crypto and banking activitiesThe Federal Reserve Board said Thursday that it was rescinding three supervisory letters that played a major role in stunted adoption of crypto offerings among American banks and financial institutions."The Board is rescinding its 2022 supervisory letter establishing an expectation that state member banks provide advance notification of planned or current crypto-asset activities. As a result, the Board will no longer expect banks to provide notification and will instead monitor banks' crypto-asset activities through the normal supervisory process," the board also rescinded a 2023 supervisory letter "regarding the supervisory nonobjection process for state member bank engagement in dollar token activities."Finally, the FRB announced it was withdrawing two jointly issued statements with the FDIC and the Office of the Comptroller of the Currency that limited banks' exposure to also expressed commitment toward collaborating with other regulatory agencies to consider the possibility of providing further guidance that "support innovation, including crypto-asset activities."Crypto bounces amid the Federal Reserve's pivotFollowing the announcement, crypto prices surged, signaling the market's positive reaction to the news.Bitcoin was up 1.2% in the day, climbing above $94,000 at one point before settling in at around $93, also saw a slight pump, increasing 0.4% in the day, and XRP was up 1.4% in the last 24 other altcoins on CoinGecko's Top 10 largest crypto assets by market cap were in the green, with Cardano (ADA) leading the day's rally (5.2% up).Questions rise over FRB's moveWhile many in the crypto community were ecstatic over the news, some crypto users raised questions on the short-term impact of the user pointed out that the long-term effects may result in a more structured playbook under new legislation or unified regulation, but the short-term impact may produce "more uncertainty."The user argued that without formal guidance and only rescinded supervisory notices, "banks may be unsure what is or isn't allowed."One user asked AI chatbot Grok on whether banks can now "just buy what they want," to which the popular AI assistant responded that the announcement may have "relaxed" some crypto guidance but banks are still required to follow general and a lack of clear rules of the road have hampered growth and adoption in crypto, but U.S. Securities and Exchange Commission Chair Paul Atkins has vowed it will be his administration's priority.
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