Federally Insured Credit Unions Are Now Allowed to Partner With Third-Party Crypto Service Providers
Federally Insured Credit Unions (FICU) can now partner with third-party digital asset service providers, said Todd Harper, Chairman of the National Credit Union Administration (NCUA), this week.
As a counterpart to the Office of the Comptroller of the Currency (OCC), which regulates national banks, NCUA oversees credit unions. The U.S. regulator provides deposit insurance to depositors in U.S. depository institutions.
With this announcement, the regulator said it aims to provide clarity about establishing relationships with third-party providers that offer digital asset services to the FICUs’ members.
This means FICU members are now allowed to buy, sell, and hold uninsured digital assets with the third-party provider outside of the FICU.
“As insurer, the NCUA does not prohibit FICUs from establishing these relationships,” it said in a statement.
The agency will evaluate FICU’s relationship with third parties offering crypto services the same as any other third-party relationship. FICUs, however, would be required to establish effective risk measurement, necessary due diligence, monitoring, and control practices.
NCUA said that it recognizes that so far, the activities related to digital assets may fall within the jurisdiction of other regulatory agencies like SEC and FinCEN; as such, they will continue to study and address these issues.
“As with other evolving technological changes, the NCUA acknowledges further guidance may be needed as questions continue to arise related to digital assets and DLT,” it said.
Back in July, the NCUA published a request for information (RFI) to gather information and solicit comments about the potential impact of digital assets and related technologies on FICUs, related entities, and the NCUA.