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U.S. regulators warned banks that they should know about risks tied to cryptocurrency assets, including legal uncertainties and misleading disclosures, two months after the collapse of FTX sent shockwaves through the industry.
Key Takeaways
- The Federal Reserve, Federal Deposit Insurance Corp, and the Office of the Comptroller of the Currency said banks should be aware of the risks associated with cryptocurrency.
- The agencies will monitor the crypto-asset-related exposures of banking organizations.
- The joint statement follows the collapse of the crypto exchange FTX, which spread fear across the industry two months ago.
Banks that issue or hold crypto tokens on a decentralized, public network are probably violating safe and sound banking practices, according to a statement from the Federal Reserve, Federal Deposit Insurance Corp, and the Office of the Comptroller of the Currency. The three agencies said in their first joint statement on the crypto market that they’ll monitor the exposure of banks to crypto assets.
Regulators have been reluctant to issue uniform guidance or rules on crypto assets, even though some banks have themselves sought more clarity. The statement comes after the collapse of FTX, whose founder Sam Bankman-Fried is scheduled to go on trial in October.
