The news: The Federal Deposit Insurance Corporation (FDIC) proposed new rules for how deposit insurance should be represented on digital channels, aiming at clearing up the confusion around cryptocurrency, per American Banker.
Clarity is key: The proposal outlines how the FDIC name and logo should be used in digital settings.
Not coincidental timing: The new digital guidelines were proposed just weeks after the collapse of crypto exchange FTX, signaling regulators’ urgency to take hold of the spiraling crypto sector. But this isn’t the first attempt to regulate FDIC representation.
Regulator support: The proposed rules met with support from other federal agencies, including the Office of the Comptroller of the Currency (OCC) and the Consumer Financial Protection Bureau (CFPB).
The bottom line: The FDIC’s digital update to its rules and its attempt to clarify what those rules mean for crypto firms would be strong steps in the direction of crypto regulation. And they’re also valuable to consumers who may not have a full understanding of crypto assets but are interested in learning more, as well as those who’ve already invested. Though investors may still be prey to some misunderstandings about deposit insurance, a distinct and straightforward disclosure should give pause to some before they proceed with a transaction.
This article originally appeared in Insider Intelligence’s Banking Innovation Briefing—a daily recap of top stories reshaping the banking industry. Subscribe to have more hard-hitting takeaways delivered to your inbox daily.
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