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On this observe, a report revealed on Feb 16 by the FDIC Office of Inspector General (IOG) revealed that as of January 2023, roughly 136 banks have been both concerned or planning to enterprise into crypto-related companies.
“According to FDIC data, as of January 2023, the FDIC was aware that 136 insured banks had ongoing or planned crypto asset related activities,” learn the report.
Notably, these banks have preparations with third events that enable financial institution clients to purchase and promote crypto property because of the lack of clear laws. Banks additionally present account deposit providers in addition to custody and lending providers to crypto exchanges.
As per the report, roughly 52 million Americans, or 16% of the inhabitants have purchased cryptocurrencies. Of these, 46,000 misplaced over $1 billion to cryptocurrency scams since 2021. Considering that the FTX collapse uncovered the crypto change’s shut enterprise reference to about 11 banks -raising suspicions about potential involvement in alleged wire switch fraud- the report highlighted the necessity for defense.
 
 
“The FDIC should work with other regulators to provide clarity regarding the regulation of digital assets. Further, the FDIC should ensure that its examinations, policies, and procedures address consumer risks regarding digital assets, including the relationship of deposit insurance and digital assets,” the report added.
The report by IOG comes after a spate of meltdowns by high-level crypto companies resulting in elevated requires regulatory oversight. Although the FDIC has maintained a reasonably sceptical stand on cryptocurrencies, its angle has grow to be extra essential. In a number of communications, the regulator has cautioned banks to steer clear of digital property, citing the potential dangers that they pose to the broader monetary system.
On Friday, the regulator issued a joint assertion alongside the Federal Reserve and the Office of the Comptroller of the Currency directing banks to use present threat administration ideas when coping with crypto property or stablecoins deposits.
It is essential for banking organizations that use sure sources of funding from crypto-asset-related entities…to actively monitor the liquidity dangers inherent in such funding sources and set up and keep efficient threat administration and controls commensurate with the extent of liquidity dangers from such a funding supply,” the assertion learn.
Content Source: zycrypto.com
