US Regulators Shift Stance on Crypto as FSOC Drops Digital Assets from Vulnerability List
The Financial Stability Oversight Council's 2025 annual report marks a seismic shift in regulatory posture, removing digital assets from its list of financial-system vulnerabilities. This ends a three-year period where crypto was framed as a potential contagion risk requiring strict oversight.
Gone are the warnings about 'crypto-asset activities' posing systemic risks from the 2022 Biden-era report. The new classification places digital assets in a neutral monitoring category, acknowledging institutional adoption through Bitcoin ETFs and asset tokenization.
The reversal is particularly striking given FSOC's 2024 stance that stablecoins represented 'acute vulnerabilities.' Now, regulators have quietly withdrawn previous warnings to banks about crypto exposure—a tacit endorsement of the sector's maturation.