Three U.S. agencies – Federal Reserve System, Federal Deposit Insurance Corporation (FDIC) and Office of the Comptroller of the Currency (OCC) – have issued a warning for the banking sector on the risks associated with operations in the crypto-currency market. To minimise contagion with the risk arising from exposure to the crypto-asset sector, there is a plan to enhance supervision of banks carrying on a business in the area of crypto-currencies and to review their related business models.

The reasons behind the plan include general lack of stability of crypto-assets caused by the crisis of the FTX exchange and other entities, as well as risks related to digital assets: very high occurrence of fraud and embezzlement, lack of legal certainty or property rights, falsification of information, or lack of transparency around the business of such firms.

In December last year, the Department of Financial Services (DFS) introduced an obligation for banks to notify any plan regarding virtual currencies at least 90 days prior to the start date of operations. The rules apply also where some of those operations are to be carried out by a third party.