FDIC Warns Banks Against Crypto Partner Insurance Disclosures

By Elise Hansen (July 29, 2022, 7:31 p.m. EDT) – Banks working with cryptocurrency companies should ensure that all communications regarding deposit insurance are accurate, as there is a high risk of confusion customers with respect to digital assets, the Federal Deposit Insurance Corp. warned Friday.

The advisory came a day after the FDIC and the Federal Reserve Board accused bankrupt cryptocurrency firm Voyager Digital of misleading consumers about its deposit insurance arrangements. In Friday’s advisory, the FDIC warned that there is an increased risk of confusion about whether and when deposit insurance applies when banks work with non-banks or so-called neo-banks.

“Risks are high when a non-bank entity offers crypto…

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