FSOC Removes Crypto from Risk List: U.S. Financial Watchdog Shifts Stance on Digital Assets

In a significant regulatory development, the U.S. Financial Stability Oversight Council (FSOC) has revised its annual report, notably omitting digital assets from its list of potential threats to financial stability. This marks a departure from previous years where cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) were explicitly flagged for their volatility and potential to disrupt traditional markets. The FSOC, comprising top U.S. financial regulators, now focuses its 2024 risk assessment on climate change, AI, and banking liquidity. Industry analysts view this shift as a potential signal of growing institutional acceptance and a move towards a more nuanced regulatory framework for blockchain technology and crypto markets. However, the Council reiterated that the absence from the list does not equate to an endorsement and that monitoring of the sector continues.