U.S. FDIC asks banks for info on crypto activities, cites potential ‘systemic risks’
WASHINGTON (Reuters) – The U.S. Federal Deposit Insurance coverage Company (FDIC) on Thursday stated the 1000’s of banks it supervises ought to notify the regulator of any crypto-related actions they’ve or are planning.
Citing potential systemic dangers from sure crypto belongings and actions, the FDIC stated any agency contemplating dabbling in crypto ought to inform the company of its plans, and any establishment already concerned in such actions ought to “promptly” notify the FDIC, the regulator stated in a press release.
“Crypto-related actions might pose vital security and soundness dangers, in addition to monetary stability and shopper safety issues,” the FDIC stated, noting evolving credit score, liquidity, pricing and operational dangers that aren’t but absolutely understood.
The request comes as U.S. banking regulators reckon with the growing reputation of cryptocurrencies. U.S. President Joe Biden final month instructed authorities companies to evaluate the dangers and advantages of varied cryptocurrency points, a transfer seen as a stark acknowledgement of the potential penalties of the rising significance of digital belongings.
A disruption in crypto-asset transactions or actions may end in a “run” on a agency’s monetary belongings and shoppers could also be confused about crypto belongings supplied by, by means of or reference to their establishments, the FDIC stated on Thursday.
Previous to leaping right into a crypto-related exercise, the FDIC-supervised establishment ought to notify the regulator, offering particulars on the deliberate exercise and proposed timeline. The company stated it plans to assessment the data for security and soundness, monetary stability and shopper protections.
(Reporting by Chris Prentice; modifying by Bernard Orr)
