The Federal Deposit Insurance Corporation slapped the Sam bankman-fried-owned cryptocurrency exchange ftx with a cease-and-desist order. The FDIC does n’t cover stocks or crypto, and only safeguards funds held in insured bank accounts.

Ftx president Brett Harrison tweeted that’direct deposits from employers to ftx us are stored in individually FDIC-insured bank accounts in the users’ names’. The FDIC claims this falsely represents that ftx and the funds invested by users are FDIC-insured when they’re really not.

Fdic’s letter says’cash associated with brokerage accounts is managed into FDIC-insured accounts’ at ftx’s’partner bank’.

We did n’t mean to mislead anyone, and did n’t suggest that ftx us itself benefit from FDIC insurance. I hope this provides clarity on our intentions.

Ftx does not have FDIC insurance (and we’ve never said so on website etc). Banks we work with do. We never meant otherwise, and apologize if anyone misinterpreted it.

Ftx CEO Harrison has since issued a response to the FDIC’s letter, stating that while’ftx does not have FDIC insurance,’ the banks it does business with do.

The FDIC declined to comment beyond the contents of its letter. ftx did n’t immediately respond to the request for comment.

In May, crypto billionaire bankman-fried disclosed a 7.6 percent stake in Robinhood. He’s reportedly looking into purchasing the trading platform.