OKCoin Exchange Under FDIC Fire: End of Misleading Claims Required!

The Federal Deposit Insurance Corp. (FDIC) accuses the OKCoin exchange of making false claims about customer protection. She thus ordered the company to put an end to the misleading statements. The regulatory authority had already issued similar injunctions to other crypto exchanges.

Agency Orders Stop Misleading Representations About OKCoin

In a letter to CEO Hong Fang, the FDIC ordered OKCoin USA Inc to immediately remove all offending claims from its site. Otherwise, the company will be subject to legal action for violation of US banking law. Indeed, the agency indicates that OKCoin is not insured by the FDIC and the FDIC does not insure products other than deposits. FDIC insurance coverage applies to all customer funds, including cryptos. There is no distinction between USD deposits and crypto-assets.

THE misrepresentations cited by the agency are three in number. This includes the mention on the OKCoin website that the Hash token has received wide regulatory acceptance from the SEC, OCC, FED, and FDIC. There is also the post on the site announcing the company as licensed across the United States with FDIC assurance on OKCoin accounts.

Other exchanges have received similar injunctions

The FDIC had already issued similar injunctions to other companies. We can cite Voyager Digital and FTX.US, which are now bankrupt. The agency also issued a broader warning to the cryptocurrency industry. She claimed that FDIC protections only apply to banks and not crypto companies with FDIC-insured bank accounts.

OKCoin has nevertheless responded to these accusations against it. According to its spokesperson, compliance with applicable laws and regulations is a fundamental principle at OKCoin. The company thus remains committed to working with stakeholders, including regulators, whenever possible. He added that the company is aware of this issue and is taking immediate steps to evaluate the FDIC statements.