The Federal Deposit Insurance Corporation (FDIC) says it is working with other federal authorities to closely monitor how banks handle crypto assets.
In a new risk assessment report, the FDIC says crypto assets pose “new and complex risks” to the financial system due to the presence of fraud and the rapid pace of its innovation.
The FDIC also says the industry’s interconnectedness with parts of the financial system could pose contagion risks to US banks.
“Crypto-assets pose new and complex risks that are difficult to fully assess.120 Part of the difficulty in assessing these risks stems from the dynamic nature of crypto-assets, the crypto marketplace, and the fast pace of innovation. Some of the major risks associated with crypto assets and participants in the crypto asset industry include those related to fraud, legal uncertainties, misleading or inaccurate statements and disclosures, risk management practices that lack maturity and robustness, and platform – and other operational vulnerabilities.
Potential contagion risk within the crypto-asset sector due to interconnections between certain crypto-asset participants may create concentration risks for banks exposed to the crypto-asset sector. Stablecoin susceptibility to risk can create the potential for deposit outflows for banks holding stablecoin reserves.
The agency says it is working with central bank agencies to monitor how banks are handling or being exposed to crypto assets, and is ready to start “supervisory talks” with banks on the matter.
“The FDIC, in conjunction with the other federal banking agencies, continues to closely monitor the crypto-asset-related exposures of banking organizations. As warranted, the FDIC will issue additional statements regarding the involvement of banking organizations in crypto-asset-related activities. The FDIC has also developed processes to engage in robust supervisory discussions with banking organizations on proposed and existing crypto-asset-related activities.
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