Blockchain Association Backs Federal Reserve Plan to Drop Reputational Risk From Bank Supervision

Blockchain Association urged the Federal Reserve to formally remove reputational risk from bank supervision, saying the concept has been used to limit banking access and should be aligned with OCC and FDIC actions.

Summary

Blockchain Association, a crypto industry advocacy group, supported the Federal Reserve’s proposal to formally remove reputational risk from bank supervision. In a comment letter, the group said the concept had been used to justify restricting financial services for crypto companies and warned that formally eliminating it remains important even after its reported removal from examination programs in June 2025. The association urged the Federal Reserve to align its final rule with similar actions completed on April 7 by the OCC and the FDIC, arguing that consistent supervisory standards across U.S. bank regulators would help address barriers to banking access for digital asset firms.

Terms & Concepts
  • Reputational risk: A supervisory concept referring to the possibility that negative public perception could harm a bank’s business, often cited in reviews of customer relationships.
  • Bank supervision: Regulatory oversight of banks’ safety, soundness, and compliance practices by authorities such as the Federal Reserve, OCC, and FDIC.
  • Crypto companies: Businesses operating in the digital asset sector that may rely on banking services for payments, custody, payroll, and other operations.