Bank Abandons Crypto Activity Plans

Board of Directors
XXXXX

Subject: Response to Notification Regarding Crypto-Related Activities

Dear Members of the Board:

The FDIC acknowledged the notification provided by XXXXX (Bank) on April 20, 2022, regarding the Bank’s intent to engage in crypto-related activities. The notification stated that on February 1, 2022, the Bank joined XXXXX, a provider of technology, would enable XXXXX customers to buy, sell and hold bitcoin and Ether. The notification was provided pursuant to Financial Institution Letter (FIL) FIL-16-2022 Notification of Engaging in Crypto-Related Activities. FIL-16-2022 requested that all FDIC-supervised institutions that intend to engage in, or are currently engaged in, any activities involving or related to crypto-assets (also referred to as “digital assets”) promptly notify the appropriate FDIC Regional Director. The FIL also encourages institutions to notify their state regulator. On September 1, 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.

In a letter dated April 5, 2023, Chairman and CEO XXXXX stated that the Bank had not implemented the proposed activity and is not pursuing crypto-related activities. The FDIC acknowledges the Bank’s updated status related to this activity. 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 my attention at the New York Regional Office, and sent as a PDF document through the FDIC’s Secure Email portal (securemail.fdic.gov) using the following e-mail address: XXXXX@FDIC.gov.

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 any questions, please contact Case Manager XXXXX at XXXXX, or Review Examiner XXXXX at XXXXX.

Sincerely,
Frank R. Hughes
Regional Director

cc: XXXXX
Federal Reserve Bank of New York