FDIC To Develop New Strategy For Regulating Crypto By January


This article has been republished with permission from Binance News.

According to CoinDesk, the U.S. Federal Deposit Insurance Corp. (FDIC) has been criticized by its inspector general for leaving banks under its supervision unprepared to navigate the regulator’s crypto expectations. As a result, the FDIC has agreed to develop a new strategy by January. The Office of the Inspector General for the FDIC found the agency’s performance in preparing the industry for crypto risks to be lacking, according to a report issued on Wednesday.

The report concluded that the FDIC’s lack of clear procedures causes uncertainty for supervised institutions in determining the appropriate actions to take. The agency also hadn’t concluded its effort to assess whether it could head off systemic banking dangers from crypto. The inspector general noted that the FDIC told some banks to pause their crypto activities last year and this year, but then it didn’t tell the banks how long they’d be paused or how it might end.

The FDIC has been suspicious of the digital assets industry and has leaned toward shielding the banking system from deep involvement with crypto. This stance has been felt acutely by crypto businesses struggling to find and maintain banking relationships in the U.S. The agency agreed to inspector general recommendations that it come up with a plan and schedule for figuring out the risks cryptocurrency activity poses to lending institutions, and that it also clarify its process for the crypto reviews at individual banks.

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