FDIC Makes Crypto Evaluation a Priority This Year Citing ‘Significant Safety and Financial System Risks’
The U.S. Federal Deposit Insurance Corporation (FDIC) has named the evaluation of crypto assets a priority this year. “The rapid introduction of a variety of crypto-asset or digital asset products into the financial system could pose significant safety and soundness and financial system risks,” the FDIC said.
Crypto Evaluation Named a Priority for FDIC
The U.S. Federal Deposit Insurance Corporation (FDIC) announced Monday that Acting Chairman Martin J. Gruenberg has released the FDIC’s priorities for the coming year.
The FDIC is an independent agency created by the U.S. Congress to maintain stability and public confidence in the nation’s financial system.
One of the priorities is to “evaluate crypto-asset risks,” the announcement details, elaborating:
The rapid introduction of a variety of crypto-asset or digital asset products into the financial system could pose significant safety and soundness and financial system risks.
“It is imperative that the federal banking agencies carefully consider the risks posed by these products and determine the extent to which banking organizations can safely engage in crypto-asset-related activities,” the agency stressed.
“To the extent such activities can be conducted in a safe and sound manner, the agencies will need to provide robust guidance to the banking industry on the management of prudential and consumer protection risks raised by crypto-asset activities,” the FDIC said.
In May last year, the FDIC issued a Request for Information (RFI) on crypto assets. The agency explained that it is gathering information and soliciting comments from interested parties “about insured depository institutions’ current and potential digital asset activities.”
Jelena McWilliams, who was the chairman of the FDIC at the time, said the agency is “laying the foundation for the next chapter of banking by ensuring we have a regulatory framework that allows responsible innovation to flourish.” McWilliams opined:
Digital assets is one area in which we have seen rapid expansion and innovation in recent years. This RFI gives us an opportunity to gain additional insight into the market, and what role banks might play in the future.
November last year, the FDIC, the Board of Governors of the Federal Reserve System (FRB), and the Office of the Comptroller of the Currency (OCC) announced that they are collaborating to establish crypto policies for financial institutions.
What do you think about the FDIC making crypto evaluation a priority? Let us know in the comments section below.