On January 3, 2023, federal bank regulatory agencies issued a statement highlighting key risks for banking organizations associated with crypto-assets and the crypto-asset sector. The statement also describes the agencies’ approaches to supervision in the area of crypto-Asset risks.
According to the OCC’s press release, the statement particularly describes several key risks associated with crypto-assets and the crypto-asset sector, as demonstrated by the significant volatility and vulnerabilities over the past year. As enumerated by the agencies in their statement, key risks associated with crypto-assets and crypto-asset sector participants include risk of fraud and scams, legal uncertainties, inaccurate or misleading representations and disclosures, and significant volatility in crypto-asset markets, to name a few.
In light of these risks, the agencies stressed that they will continue to:
Take a careful and cautious approach related to current and proposed crypto-asset-related activities and exposures at banking organizations;
Assess whether or how current and proposed crypto-asset-related activities by banking organizations can be conducted in a manner that is safe and sound, legally permissible, and in compliance with applicable laws and regulations; and
Closely monitor crypto-asset-related exposures of banking organizations.
The OCC’s press release can be found here.
The full joint statement can be found here.
