Last Updated on 2 hours by John Piper

A group of US federal banks regulatory agencies have issued a joint statement on the banking practices in crypto and the ongoing efforts to keep operations going despite the challenges.

The Federal Reserve, Federal Deposit Insurance Corporation, (FDIC), and the Office of the Comptroller of the Currency released statements earlier this week to address the risks and future motion in the cryptocurrency industry.

1/ Federal Reserve, FDIC, and OCC have just released the devastating Joint Statement on Crypto-Asset Risques to Bank Organizations. https://t.co/nvmpg0Qpf4

— Margaret Rosenfeld (@RosenfeldM), January 3, 2023

The following is the agency notice:

“It’s important that the risks associated with the crypto-asset industry that cannot be controlled or mitigated do not migrate into the banking system… Bank organizations are neither prohibited or discouraged from offering banking services to customers of specific classes or types, as permitted or required by law or regulation.”

Eight risks and challenges faced by the industry were identified by the firms, including fraud and volatility. The firms identified eight issues with blockchain-based assets such as Bitcoin ($BTC) and stablecoins like Tether ($USDT), including the purchase, holding, storing, transferring, and storage without standard protocols. According to the statement

“Based upon the agencies’ experience and current knowledge, the agencies believe issuing or holding principal crypto-assets that have been issued, stored or transferred on an open and public network or similar system, is highly unlikely to be inconsistent with sound and safe banking practices.”

They also recommended that regulation of cryptocurrency at the national level be based on a context approach. This means that each case and asset must be considered in light of the larger context in the United States.

Although crypto regulation in the United States is still a moving target, there has been some progress in approaching the industry.

Coin Insider’s first article, “Fed agencies in the US address crypto-industry risks and regulation” appeared first on Coin Insider.