Share this article
Voyager Digital’s Clash With US Regulators Followed by Broader FDIC Warning
After directing the crypto-lending platform to cease and desist claims that its customers were shielded by deposit insurance, the agency is now telling everybody else what not to do.
Updated May 11, 2023, 5:11 p.m. Published Jul 29, 2022, 4:04 p.m.
Make us preferred on Google
The day after demanding Voyager Digital erase its claims that customers’ funds would get government protections, the U.S. Federal Deposit Insurance Corporation has issued a broader warning to bankers that they need to keep their crypto partners in line.
The agency, which maintains an insurance fund to pay back depositors if their banks fail, doesn’t extend that protection to failing cryptocurrency firms that use those banks, according to an FDIC letter to banks posted Friday.
STORY CONTINUES BELOW
“FDIC insurance does not protect a nonbank’s customers against the default, insolvency, or bankruptcy of any nonbank entity, including crypto custodians, exchanges, brokers, wallet providers or other entities that appear to mimic banks but are not,” the agency instructed.
The FDIC guidance added that if a bank’s crypto partner “makes misrepresentations about the nature and scope of deposit insurance,” there could be legal risks for that regulated lender.
The FDIC and Federal Reserve sent a letter to Voyager CEO Stephen Ehrlich this week that accused the crypto lender of misleading customers about the protections on their assets by implying that they’d be covered by deposit insurance in the event of Voyager’s collapse. The letter, however, came late for Voyager customers now struggling to get their money back as the company makes its way through bankruptcy court.
The Toronto-based firm had accounts at Metropolitan Commercial Bank in New York, which itself is FDIC-insured, but only in case of a failure of Metropolitan – not Voyager. Now the FDIC is warning that banks such as Metropolitan are responsible for keeping track of what their business partners might be claiming.
“In their dealings with crypto companies, insured banks should confirm and monitor that these companies do not misrepresent the availability of deposit insurance in order to measure and control risks to the bank, and should take appropriate action to address such misrepresentations,” the agency said.
More For You
KuCoin captured a record share of centralised exchange volume in 2025, with more than $1.25tn traded as its volumes grew faster than the wider crypto market.
What to know:
- KuCoin recorded over $1.25 trillion in total trading volume in 2025, equivalent to an average of roughly $114 billion per month, marking its strongest year on record.
- This performance translated into an all-time high share of centralised exchange volume, as KuCoin’s activity expanded faster than aggregate CEX volumes, which slowed during periods of lower market volatility.
- Spot and derivatives volumes were evenly split, each exceeding $500 billion for the year, signalling broad-based usage rather than reliance on a single product line.
- Altcoins accounted for the majority of trading activity, reinforcing KuCoin’s role as a primary liquidity venue beyond BTC and ETH at a time when majors saw more muted turnover.
- Even as overall crypto volumes softened mid-year, KuCoin maintained elevated baseline activity, indicating structurally higher user engagement rather than short-lived volume spikes.
More For You
Ukraine banned Polymarket and there’s no legal way for it to come back
Polymarket and similar platforms are considered unlicensed gambling operators, leading to blocked access.
What to know:
- Ukraine has no legal framework for Web3 prediction markets, and current legislation provides no recognition for such platforms.
- Polymarket and similar platforms are considered unlicensed gambling operators, leading to blocked access.
- Legal changes are unlikely in the near future, as Parliamentary revisions to gambling definitions are extremely improbable during wartime, leaving prediction markets in a legal deadlock.
Top Stories
