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FDIC Tells Crypto Exchange CEX.IO to Stop Claiming US Dollars Held in Its Wallets Are Insured
The agency issued a cease-and-desist letter on Wednesday.
By Nelson Wang
Updated Feb 15, 2023, 7:32 p.m. Published Feb 15, 2023, 7:21 p.m.
The Federal Deposit Insurance Corporation (FDIC) has issued a cease-and-desist letter to CEX.IO telling the Naperville, Illinois-based crypto exchange to stop claiming that U.S. dollars held in its fiat currency wallets are FDIC-insured.
The agency said a section of CEX.IO’s website inaccurately states that “U.S. dollars held in your CEX.IO fiat currency wallet are FDIC-insured up to $250,000 per account.” But the FDIC noted in its letter that “no qualifications, clarifications or limitations are made in connection with this representation, and no insured depository institution or institutions (IDIs) are identified in connection with this statement.”
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The FDIC also noted that other websites have mistakenly reported that CEX.IO is FDIC-insured.
The FDIC demanded that CEX.IO remove any statements or references anywhere that suggest the exchange is FDIC-insured and that any funds held in crypto by it are protected by FDIC insurance.
CEX.IO is one of the smaller centralized crypto exchanges, with 24-hour trading volume of $2.9 million and monthly visits of 892,000, according to CoinGecko.
Read more: Banking Startup LevelField Aims to Become First FDIC-Insured Institution to Offer Crypto Services
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