Federal regulators could be going too far in encouraging banks not to work with crypto companies, according to the top Republican on the Senate Banking Committee.
Sen. Pat Toomey of Pennsylvania sent a letter Tuesday to Acting Chairman of the Federal Deposit Insurance Corporation Martin Gruenberg, reporting that whistleblowers have come forward to say that the FDIC is “improperly taking action to deter banks from doing business with lawful cryptocurrency-related companies.”
Toomey said that affected parties have come forward to say that their banks have received letters from regional FDIC offices, at the direction of officials at the agencies Washington, D.C. headquarters, “requesting that they refrain from expanding relationships with crypto related companies, without providing any legal basis for doing so.”
The FDIC is one of the nation’s most important banking regulators, as it ensures retail customer deposits and supervises banks to establish their safety and soundness.
“The FDIC is acting consistent with longstanding legal authorities to ensure that banks engaging in crypto-related activities are doing so in a safe and sound way that protects consumers,” an agency spokesperson said in a statement.
“This may involve the FDIC requesting that an institution delay initiating or refrain from expanding crypto-related activities until supervisory feedback is taken into account,” the statement continued. “Given the risks readily apparent in the crypto-asset markets, these...
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