The FDIC discouraged banks from using public blockchains such as Ethereum. Documents obtained through the Freedom of Information Act revealed these concerns, emphasizing issues regarding transparency and control. The regulator instead advised banks to deploy private, permissioned networks, which offer more control over participant activities.

The Biden administration’s alleged coordinated effort against the crypto sector was further exposed. The FDIC’s advisory aligns with broader regulatory strategies seen across various government levels, suggesting a potential push back on crypto’s integration into traditional finance.

This development signals a negative stance towards public blockchain experimentation by banks. The restrictive position could result in decreased involvement of financial institutions in the cryptocurrency market, including key assets like Bitcoin and Ethereum, affecting overall market dynamics.