Fed targets crypto debanking with new rule proposal

The Fed proposes ending "reputation risk" in bank supervision, aiming to stop crypto debanking and ensure decisions are based on financial risk. Public comments are open for 60 days.

The US Federal Reserve has proposed a new rule to eliminate the use of "reputation risk" as a basis for bank supervision. This aims to stop banks from refusing services to lawful businesses, including those in the crypto sector, due to subjective or political concerns. Announced on February 24, 2026, the proposal opens a 60-day public comment period. The goal is to ensure banks make decisions based solely on objective financial risk management, rather than personal or political biases. This move is widely viewed as a response to the controversial "Operation Chokepoint 2.0," which led to the debanking of crypto firms. The policy shift is expected to improve banking access for digital asset companies, foster greater integration of crypto into the traditional financial system, and address concerns about discriminatory practices.