Crypto

FTX US Has Trouble With Federal Deposit Guarantee Agency (FDIC) – CryptoActu

FTX caught lying? At least that’s what the Federal Deposit Insurance Corporation (FDIC) advises, which on Friday, along with four other companies, sent a cease-and-desist letter to its US subsidiary over alleged misrepresentations of deposit insurance.

FTX US under FDIC crosshairs over false claims

The FDIC said in a statement that they sent letters asking FTX US, as well as Cryptonews, Cryptosec, SmartAsset.com, and FDICCrypto, to stop making misleading claims about federal agency insurance that guarantees bank deposits. He invites them manu militari to take immediate remedial action.

Based on evidence collected by the FDIC, each of these companies has made false statements, including on their websites and social media, claiming or suggesting that certain cryptocurrency-related products are FDIC-insured or that stocks held on brokerage accounts are FDIC insured.

FDIC Statement

In the case of FTX US, the body criticizes its president, Brett Harrison, for a July 20 tweet in which he assured that “direct employer deposits in FTX US are held in bank accounts individually insured by the FDIC in the name of the user.” . A tweet that has since been deleted.

But the FTX US CEO wouldn’t be vigilant if he left the response visible on the twitter thread.

FDIC stands its ground

Unfortunate or deliberate act? In any case, the FDIC, whose attention would also have been drawn, and which also notes that SmartAsset identifies FTX as an FDIC-insured exchange, has not moved.

These false and misleading statements represent or imply that FTX US is FDIC insured, that funds deposited with FTX US are deposited and permanently held in anonymous FDIC insured bank accounts, that FTX US brokerage accounts are FDIC insured, and that only FDIC insurance is available for cryptocurrencies or stocks. In fact, FTX US is not FDIC insured, the FDIC does not insure any brokerage accounts, and the FDIC insurance does not cover stocks or cryptocurrencies.

A firm stance in line with her previous statements in which she opposed insurance for non-banking entities, including businesses related to cryptocurrencies. Orientation accompanied by very careful monitoring of banking institutions tempted by cryptocurrencies.

Regulation

FDIC, the insurer of US banks, is concerned about their cryptocurrency activity

Natalie E. – 09 Apr 2022 – 12:59

The Federal Deposit Insurance Corporation (FDIC), an independent agency […]

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An approach that some consider too harsh. Pennsylvania Senator Pat Toomey, who also sits on the Senate Banking Committee, recently warned about this in a letter to the federal agency. He says he is concerned that the FDIC is taking inappropriate steps “to deter banks from doing business with legitimate cryptocurrency companies.”

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