FDIC Issues Crypto-Related Cease and Desist Orders to 5 Companies Including FTX US Exchange

The Federal Deposit Insurance Corporation (FDIC) has sent a cease and desist missive to 5 companies, including crypto speech FTX US. CEO Sam Bankman-Fried explained that FTX does not person FDIC insurance, stating: “We ne'er meant otherwise, and apologize if anyone misinterpreted it … to beryllium wide FTX US isn’t FDIC insured.”

FDIC Orders 5 Firms to Cease and Desist

The Federal Deposit Insurance Corporation (FDIC) issued crypto-related cease and desist orders to 5 companies Friday. The bureau regulates and insures the deposits of FDIC-insured assemblage banks and different fiscal institutions.

The letters request that the 5 companies and their officers “cease and desist from making mendacious and misleading statements astir FDIC deposit insurance.” They indispensable besides “take contiguous corrective enactment to code these mendacious oregon misleading statements.”

The 5 companies are FTX US, Cryptonews.com, Cryptosec.info, Smartasset.com, and FDICCrypto.com.

The FDIC detailed:

Each of these companies made mendacious representations — including connected their websites and societal media accounts — stating oregon suggesting that definite crypto–related products are FDIC–insured oregon that stocks held successful brokerage accounts are FDIC–insured.

According to the FDIC, Cryptonews.com has reviews connected its website claiming that Coinbase, Etoro, and Gemini crypto trading platforms are FDIC insured. Cryptosec.info and Smartasset.com supply a database of FDIC-insured crypto exchanges that includes Crypto.com, Luno, Robinhood, and Voyager. Meanwhile, FDICCrypto.com blatantly registered a website with FDIC successful its domain name.

FTX US Ordered to Cease and Desist

FTX US is 1 of the crypto firms that received a cease and desist letter from the FDIC.

Although FTX and FTX US are 2 abstracted trading platforms, they are some founded by Sam Bankman-Fried, who is presently the CEO of some companies. Global speech FTX does not let U.S. residents to commercialized connected its platform.

Bankman-Fried apologized for the disorder regarding FDIC security connected Twitter. “Clear connection is truly important; sorry!” helium tweeted. “FTX does not person FDIC security (and we’ve ne'er said truthful connected website etc.); banks we enactment with do. We ne'er meant otherwise, and apologize if anyone misinterpreted it.” In a follow-up tweet, helium stressed: “To beryllium clear, FTX US isn’t FDIC insured.”

This was not the archetypal clip the FDIC has taken enactment against crypto companies. The regulator and the Federal Reserve Board issued a missive to Voyager Digital past period demanding the crypto lender cease and desist from making mendacious oregon misleading representations of deposit security status. Voyager filed for bankruptcy extortion past month.

What bash you deliberation astir the FDIC issuing crypto-related cease and desist orders to 5 companies? Let america cognize successful the comments conception below.