The FDIC completes disclosures for insured institutions, a hint for crypto companies.
The United States' Federal Deposit Insurance Corporation (FDIC) has approved legislation to regulate official signs and advertisements in a move that could affect the public perception of some crypto companies.
In the year In a Dec. 20 announcement, the FDIC said its board of directors had finalized regulations addressing “false advertising, misrepresentation of deposit insurance coverage, and misuse of the FDIC's name or logo.” Instead of the gold and black logo introduced in the 1930s, FDIC-insured institutions will be required to display a black and navy blue logo starting in 2025 on all websites and applications, brick-and-mortar bank locations and certain ATMs.
According to the FDIC, the last significant revision to the mark and notice rules was in 2006. The state corporation explained that the revised rule aims to address entities that may mislead customers that their funds are FDIC-certified.
“While the rule finalized today is not limited to the crypto industry, crypto-attacks are so widespread that the FDIC has taken several steps to stop it,” said Dennis Kelleher, president and CEO of the Bitcoin Markets Association. “Investors have been misled by Gemini Earnings, FTX US, Voyager Digital and other crypto firms into believing that their investments are FDIC guaranteed. We appreciate the FDIC's actions to improve and strengthen its rules to address this abusive practice.
Related: Crypto Adoption: How FDIC Insurance Can Bring Bitcoin to the Masses
In the year In 2023, several banks with ties to crypto companies have collapsed, been shut down by authorities or voluntarily exited, prompting discussions among lawmakers about protecting users' funds. The FDIC worked with the New York State Department of Financial Services to close Signature Bank.
Silicon Valley Bank collapsed in March and seized deposits from Stalkcoin Issuing Circle and venture capital firm Sequoia Capital, which were secured under the FDIC. In most cases, the FDIC will insure up to $250,000 per deposit.
In June, the Consumer Financial Protection Bureau warned that payment apps that allow crypto transactions may not necessarily be FDIC-insured, putting funds at risk. The FDIC also called crypto activities “new and complex risks” for US banks, given the uncertain legal and regulatory environment.
Journal: Unstable Coins: Debasement, Bankruptcy and Other Risks Looming.
