The pioneering cryptocurrency bank, Anchorage Digital, finds itself under the scrutiny of the U.S.
Department of Homeland Security, according to a recent report from Barron’s which cited insider sources.
Federal Investigation Launched into Crypto Banking Pioneer.
This development marks another chapter of regulatory challenges for the institution, as it follows previous criticisms regarding its adherence to Bank Secrecy Act and Anti-Money Laundering (BSA/AML) benchmarks.
El Dorado Task Force Leads Probe, Contacts Ex-Employees
Homeland Security’s El Dorado Task Force is reportedly spearheading the investigation and is a specialized unit dedicated to tackling financial malfeasance and illicit money movements.
As part of their investigative process, the task force has engaged with former employees of Anchorage, although the precise objectives and parameters of the probe are still under wraps.
Anchorage’s Prominence and Partnerships Despite Scrutiny
Anchorage Digital, despite the shadow of this investigation, occupies a prominent position within the digital asset landscape, having forged alliances with established financial heavyweights including Cantor Fitzgerald and BlackRock.
Notably, Cantor Fitzgerald’s past leadership includes Howard Lutnick, who currently serves as a key figure in the Trump administration as Commerce Secretary.
Cantor Fitzgerald and BlackRock Collaborations Highlighted
A significant partnership formed last November saw Cantor Fitzgerald collaborating with both Anchorage and Copper for its venture into Bitcoin financing on a global scale.
This arrangement entrusts Anchorage and Copper as custodians and managers of collateral for this new financial arm, initially aiming for $2 billion in financing.
The collaboration is strategically designed to provide institutional investors with elite-level digital asset custody solutions.
BlackRock Taps Anchorage for Spot Crypto ETF Custody
Furthermore, asset management titan BlackRock has selected Anchorage to safeguard assets for its recently launched spot crypto ETFs.
BlackRock’s ETF offerings currently encompass both Bitcoin (IBIT) and Ethereum (ETHA) based funds.
Impressively, these spot crypto ETFs had amassed approximately $50 billion in assets under BlackRock’s management as of March 31st, as detailed in their first-quarter earnings report.
Prior OCC Regulatory Action in 2022
This current inquiry is not the first time Anchorage Digital has been on the regulatory radar.
Back in 2022, the Office of the Comptroller of the Currency (OCC) took formal action against Anchorage’s banking arm, citing failures to adequately meet BSA/AML requirements as outlined in their operational agreements with the agency.
Also Read: US States Advance Cryptocurrency-Friendly Legislation
