Federal Reserve, Office of the Comptroller of the Currency and FDIC Issue Joint Statement Reminding Banks of Risks Related to Cryptocurrencies

The Federal Reserve, the Office of the Comptroller of the Currency, and the FDIC have issued a joint statement highlighting key risks for banking organizations related to cryptoassets and the cryptoasset space, as well as describing each agency’s approach to regulation in this space. In particular, the statement described several key risks related to crypto-assets and the crypto-asset industry, including the potential for fraud, scams, and deception, and the susceptibility of stablecoins to bank runs. The statement also cited issues such as uncertain redemption rights and unknown custody practices for crypto businesses as areas of concern. "Institutions continue to take a cautious approach to each banking organization's current or proposed crypto-asset-related activities and exposures, given the significant risks highlighted by the recent failures of several large crypto-asset firms," the statement said.