Bank Ceases Bitcoin Service Plans
FDIC
Federal Deposit Insurance Corporation
Division of Risk Management Supervision
Division of Depositor and Consumer Protection
300 South Riverside Plaza, Suite 1700, Chicago, IL 60606
Chicago Regional Office
Phone (312) 382-7500
Fax (312) 382-6901
April 11, 2023
Board of Directors
XXXXX XXXXX XXXXX
Subject: Response to Notification – Third-Party Crypto-Asset Activity
Dear Members of the Board:
On May 27, 2022, we received XXXXX (the Bank) notification of the intent to offer Bank customers the ability to buy, sell, and hold Bitcoin through the Bank’s digital and mobile banking platforms in conjunction with XXXXX.
This notification was in response to Financial Institution Letter (FIL), FIL-16-2022, Notification of Engaging in Crypto-Related Activities. On June 27, 2022, the FDIC sent a letter to the Board requesting that the Bank delay expansion of crypto-asset services while the FDIC considered the proposed crypto-related activity. On August 22, 2022, the FDIC sent a letter to the Board requesting information necessary to allow the FDIC to assess the safety and soundness, consumer protection, and financial stability implications of such activities. The requested documents were received via FDIC Connect/EFX on October 14, 2022 and December 13, 2022. A live demo of the platform was performed for regulators via MS Teams on November 29, 2022. During the February 6, 2023 Safety and Soundness Visitation, additional information was requested and meetings were held with Bank management to discuss the XXXXX proposed activity.
In a subsequent letter sent to the FDIC and XXXXX received via FDIC Connect/EFX on February 22, 2023, Bank management stated that the Bank had decided to cease efforts to provide bitcoin services to Bank customers via XXXXX and XXXXX. The letter states that the Bank will work with XXXXX and XXXXX to provide time for Bank employees to unwind their positions. Once that is completed, the Bank would terminate all access to XXXXX. The FDIC acknowledges the Bank’s updated status related to this activity, and the June 27, 2022 FDIC letter to the Board has been superseded as a result of the Bank’s February 22, 2023 communication to the FDIC and XXXXX. We request that the Bank notify this office if the status of this activity, or other crypto-related activity, changes in the future.
Written correspondence should be addressed to Gregory P. Bottone, Regional Director, FDIC, Chicago Regional Office, and sent as a PDF document through the FDIC’s Secure Email XXXXX.
Board of Directors
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April 11, 2023
portal (https://securemail.fdic.gov/) using the following email address:
XXXXX@FDIC.gov. Information about how to use secure email and FAQs about the
service can be found at https://www.fdic.gov/secureemail/.
This letter is confidential and may not be disclosed or made public in any manner under
Part 309 of the FDIC Rules and Regulations (12 CFR Part 309). If you have questions, please
contact Assistant Regional Director Debbie J. Bush XXXXXXX or Assistant Regional
Director of Compliance Amy T. Richardson XXXXXXX
Sincerely,
Gregory P. Bottone
Regional Director
cc: XXXXXXX
Federal Reserve Bank of Chicago