The Inspector General recommends that the bank deposit insurer evaluates the effectiveness of its risk mitigation measures and presents them in a more structured format.

The Inspector General’s Office (OIG) at the FDIC has issued a redacted evaluation report on the corporation’s crypto asset risk strategy. The FDIC introduced a “bottom-up” approach to assess crypto risk in early 2022, including understanding institutions’ crypto activities and providing guidance on a case-by-case and industry-wide basis. As of January 2023, 96 institutions reported their crypto-related activities, while specific feedback and advice to pause crypto-related actions were redacted in the report.

The OIG determined that the FDIC began crafting strategies to address crypto asset risks but found these efforts to be incomplete. The FDIC hasn’t yet evaluated the significance and potential impact of these risks or completed a risk assessment to determine if issuing guidance to supervised institutions is an adequate response.

The OIG categorized its recommendations as “not significant” and mentioned that the FDIC had already agreed with the recommendations and intended to implement corrective measures by the end of January 2024.

Inspector Generals were introduced at U.S. federal agencies in 1978 to conduct independent audits, evaluations, and investigations.