US supervisory authorities warn local banks of the risks of dealing with crypto after the terrible year 2022
US supervisory authorities warn local banks of the risks of dealing with crypto after the terrible year 2022
American banking supervisory authorities warned domestic financial institutions that immersion in the world of cryptography could hide different risks such as fraud
The warning is the result of a catastrophic year 2022, in which several cryptocurrency giants went down, including FTX, Terraform Labs, Three Arrows Capital, Celsius Network and more. The collapse of these companies triggered losses from investors in billions of bills and sparked panic in the industry, which led to a massive market decline. The Federal Reserve, the Federal Deposit Insurance Corp. And the Office of the Compotroller of the Currency gave a Common announcement , and advises to be extremely careful when dealing with cryptocurrencies in this area. Minimum institutions could be victims of fraud and fraud or involved in collapsing projects, which can lead to severe losses: "The events of the past year were characterized by considerable volatility and the detection of weaknesses in the crypto-asset sector. These events emphasize a number of main risks that are connected to crypto asset sector, which bank organizations should be aware of."
The guard dogs claimed that the cryptocurrency industry lacks maturity and robustness, which was a further prerequisite for financial damage. They also claimed that the sector was susceptible to cyber attacks, while Bitcoin and the alternative coins could facilitate illegal activities because there are no suitable rules. "It is important that risks related to the crypto-asset sector that cannot be reduced or controlled do not migrate into the banking system. The agencies supervised banking organizations, the risks from the crrypto-asset sector, and carefully check all suggestions of banking organizations to participate in activities, The crypto-assets concern, ”says the explanation. The supervisory authorities found that the numerous failed cryptocurrency projects harm the entire industry in the past year. In view of the risk of seeing another company in the near future, the guard dogs will continue to monitor the sector and inform the participants about the upcoming risks. Terras fail is one of the examples from 2022 that has undermined the credibility of the industry. The algorithmic stable coin of the project - VAT - was decoupled in May and later fell to zero together with the native token Luna. This led to massive investor losses because sources revealed that some people had committed suicide. Capital of the three arrows (3AC) Celsius-Netzwerk and Voyager Digital Feeling the consequences of Terra's debacle because they all had serious financial problems and had to register bankruptcy. The most notorious collapse is probably that of ftx . The platform, which was one of the largest of its kind, Preserver-Spaces = "True"> for bankruptcy protection in November, after he had not confronted with liquidity problems and had not fulfilled customer withdrawal applications. The Bahamic authorities arrested Sam Bankman-Fried-the former CEO of the stock exchange-and brought him to the Fox Hill prison because of the allegation of fraud. Later he was deported to the USA and released on a $ 250 million bond before Christmas. SBF (as it is generally called) recently advocated knowingly cheated during the US district judge Lewis Kaplan set his trial date to October. He currently lives in his parents' house and has to wear an electronic surveillance device. He could spend his life in prison if he was found guilty in a later process. . Beware of the risks
ftx and other falling giant