An anonymous source close to the central bank told Reuters this week that the Fed is confident no individual hedge fund has the necessary power to damage the financial system and is set to instead concentrate its powers on other areas.
America's hedge fund industry - which is worth around $1.7 trillion - is not subject to the same tight regulations which affect operations such as mutual funds and is likely to be relieved by the development.
Financial firms which are considered to be of particular interest to the organisation will come under close scrutiny, but will be granted access to its emergency lending fund if such action is felt necessary.
Last weekend, the Daily Telegraph claimed British funds were preparing to make performance-related payouts ahead of schedule in a bid to avoid remuneration legislation.
By Asim Shah