The United States Federal Deposit Insurance Corporation (FDIC) has sent a letter to executives of cryptocurrency exchange CEX.IO warning them that they are potentially in violation of federal law due to false and misleading statements about the exchange’s insurance status. The agency has given the exchange 15 days to make corrections.
The statement in question is found in the small print details of the exchange’s state money transmitter license information. The information for Rhode Island reads, “U.S. dollars held in your CEX.IO fiat currency wallet are FDIC-insured up to $250,000 per account.”
The FDIC letter also noted that, if the exchange has an FDIC-insured account, the insured depository institution holding the funds must be named. The letter, signed by FDIC assistant general counsel Seth Rosebrock, cites the Federal Deposit Insurance Act throughout. The letter clarified:
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