By coinnews 
This story was originally published on Banking Dive. To receive daily news and insights, subscribe to our free daily Banking Dive newsletter.
Newly relaxed oversight on how banks deal in cryptocurrency has already inspired some activity between the two realms.
Brian Foster, global head of wholesale at Coinbase, said his team has been “very busy meeting demand for banks, brokers and fintechs” now that federal banking regulators have walked back on the more skeptical bank-crypto guidance put forth under the Biden administration.
“Pretty much all of the large banks in the US are now doing something [to move forward with crypto] and we’re either behind the scenes with [or] live with pretty much all of them,” Foster said in an interview with Banking Dive. “Our [Request for Proposal] team is hard at work fielding all of these RFPs, so it’s definitely an all-out sprint,” Foster said.
Since January, federal bank regulators have done an about-face on crypto guidance. The Office of the Comptroller of the Currency, Federal Reserve and Federal Deposit Insurance Corp. have all withdrawn guidance that required banks to seek prior approval from regulators before dabbling in cryptocurrency. Regulators will instead monitor such activities through the normal supervisory process.
What’s changed, Foster said, isn’t banks’ intent to do something in crypto to meet customer demand. That’s “been there all along.”
“What’s changing now is that the demand side has just been more pronounced as the market’s grown, coupled with the changing regulatory climate, which has just made the aperture for what’s possible a little bit wider and made the risk committees feel more comfortable,” Foster said.
Brad Rustin, chair of law firm Nelson Mullins’ financial services regulatory practice in Greenville, South Carolina, said he knows that “lots and lots and lots of banks” are talking about getting in on crypto amidst the Trump administration’s regulatory shifts.
The interest is largely coming from two verticals, Rustin said: fintech-forward banks that have long had an understanding of crypto assets, and large banks that have sizable securities custodial programs.
“[The latter] are banks that did securities lending, that did margin lending, that did traditional custody services for stocks and bonds. They’re saying, ‘Well, look, this is no different than custodying a stock or a bond. It’s just how you actually control it and how you maintain it that’s different,’” Rustin said.