FDIC urges banks to police misleading crypto claims on deposit insurance

FILE PHOTO: Representations of cryptocurrencies Bitcoin, Ethereum, DogeCoin, Ripple, Litecoin are placed on PC motherboard in this illustration taken, June 29, 2021. REUTERS/Dado Ruvic/Illustration/File Photo

WASHINGTON (Reuters) - A U.S. banking regulator is urging banks dealing with cryptocurrency companies that they need to make sure customers know which of their funds will be insured by the government in case of collapse, and which have no safety net.

The Federal Deposit Insurance Corporation (FDIC) said Friday it is concerned consumers may be confused about how safe their money may be when placed in crypto assets, particularly in cases where firms offer a mix of uninsured crypto products alongside insured bank deposit products.