One of our officers has been approached by a crypto exchange to hold deposits and potentially some kind of lending. We are scheduling a meeting with them to see exactly what they're wanting. Does anyone have any experience with this? From an EDD perspective, I confirmed they're registered with FinCEN as an MSB but outside of that...? Some of it will depend on what kind of a relationship they're wanting. Any thoughts?

I assume you are a larger sophisticated bank that deals with similar sophisticated customer relationships? Otherwise, the first question I always ask is "why us"? If you have to ask this question of us, then it shows you are probably not prepared to bank such a customer. This is not a business that someone operates out of the back room of their house.

You will need a firm understanding of their customer base and their DD/Sanctions processes.

@rlcarey This is just exploratory so I can prepare for a meeting with them. Our officer is well connected in their area - with the background I have on that personal relationship, it's not unreasonable that they would at least entertain talking to us. If we were to proceed with an account, it would be a tiny piece.

We are not sophisticated by any means but we are definitely more aggressive/adaptive than other banks our size. I'm viewing this meeting as a learning experience for myself and the bank. The culture since I came on board is that we don't proceed until BSA blesses it (which is both a blessing and a curse!).

@ACBbank insight into their onboarding and ongoing monitoring would be useful. We'll definitely need to see what they're doing to comply with sanctions as well. Thanks for the suggestions!

There are many different types of Cryptocurrency and each have different risks. Someone at your FI needs to understand each to assess the risk. In addition to BSA/AML there are risks of changing value and how do the determine the market value. A lot of them are also offshore so you may have currency risk. Relying on FinCEN as an MSB is just a small part of the puzzle,