The U.S. banking regulator, the Federal Deposit Insurance Corporation (FDIC), has ordered OKCoin USA Inc. to remove any misleading statements from its website that suggest its customers’ accounts are protected by the FDIC. In its cease-and-desist demand, the FDIC stated, OKCoin is not FDIC-insured and the FDIC does not insure non-deposit products. The agency cited three examples of false and misleading representations made by the company, including a mention on its website that the Provenance Blockchain’s HASH token on OKCoin had received broad regulatory acceptance from the FDIC.
The FDIC warned OKCoin that failure to remove the offending claims from its site immediately could result in a possible enforcement action for violating U.S. banking law. This is the latest of several such warnings to crypto firms from the banking watchdog.
By not distinguishing between U.S.-dollar deposits and crypto assets, the statements imply FDIC insurance coverage applies to all customer funds (including crypto assets), the FDIC said.
A request for comment sent to the CEO late Thursday wasn’t immediately answered.