For the first time, the Federal Reserve of the US warns banks about crypto market vulnerabilities. Cryptocurrency markets are well known for being uncertain, but despite this, they still attract people because of their viability. US financial institutions were advised to be on the lookout for fraudulent activity, regulations concerning, and deceptive statements made by technology platform companies regarding crypto market vulnerabilities.
In addition, US regulators warn banks about causality risks associated with the industry, in the recent news of cryptocurrency. In just two months, the cryptocurrency sector was shaken by the bankruptcy of an FTX trading platform. Financial organizations are closely monitoring cryptocurrency operations, according to a joint statement by the Federal Reserve System, the Comptroller, and the federal department.
Banks should obtain permission before participating in any crypto-related activities, like retaining cryptocurrencies on behalf of customers, according to the Department of Controller. Previously, the federal department encouraged banks to inform their superiors before proceeding with cryptocurrency-related operations owing to the crypto market vulnerabilities that persist strongly. For more information on the latest cryptocurrency market update and other important today news cryptocurrency, make sure to visit https://cryptoventurenews.com/category/cryptocurrency-news/.
When financial players announced a new crypto exchange partnership every week during the cryptocurrency surge, bank executives said they needed more orientation from policymakers before dealing more directly with cryptocurrencies like Bitcoin (BTC) in their retail and institutional trading operations.
Within two months of FTX declaring bankruptcy, the sector has come under scrutiny for inadequate risk assessment, associated hazards, and criminal deception under crypto market vulnerabilities. In spite of the announcement stating regulators were still considering how banks can embrace cryptocurrency while upholding numerous consumer protections and anti-money laundering obligations, it seemed to hint at one possible path.
As a result of current knowledge and experience, regulators believe that granting or carrying crypto-assets approved, deposited, or transmitted via a responsive, community-based, and decentralized network is highly unlikely to be compatible with prudent and secure banking practices.
That’s it for today on the crypto market vulnerabilities and how the banks must be aware of cryptocurrency operations. Thanks for reading. We hope you found it interesting. Get in touch with us via Facebook, Twitter, and Instagram, or visit the Cryptocurrency News section on the official Crypto Venture News Website.
