Anchorage Digital Bank Faces Homeland Security Probe Amid BlackRock Partnership

Homeland Security’s El Dorado Task Force has initiated an investigation into Anchorage Digital Bank, focusing on the company’s internal practices and policies. This probe follows a previous consent order from the Office of the Comptroller of the Currency (OCC), which highlighted Anchorage’s failure to meet anti-money laundering compliance standards. The timing of this investigation is notable as it coincides with Anchorage’s recent announcement of a crypto custody partnership with BlackRock.

Anchorage Digital Bank, founded by engineers Diogo Mónica and Nathan McCauley in 2017, is the only federally chartered digital asset bank. The company has significant backers, including Andreessen Horowitz and Goldman Sachs. The OCC’s consent order in the past underscored the importance of compliance with federal laws and regulations, emphasizing that all nationally chartered banks must adhere to high standards, regardless of their activities.

The investigation by Homeland Security’s El Dorado Task Force, established in 1992, aims to disrupt and dismantle transnational money laundering organizations through proactive investigations. The task force’s mission is to ensure that financial institutions comply with anti-money laundering standards and other regulatory requirements. The probe’s focus on Anchorage Digital Bank suggests a heightened scrutiny of the company’s compliance measures and internal policies.

Anchorage Digital Bank’s recent partnership with BlackRock for crypto custody services adds another layer of complexity to the situation. BlackRock, the world’s largest investment bank, holds tens of billions of dollars in digital assets. The partnership is intended to lay the groundwork for deeper collaboration between the two firms in response to rising client demand for digital assets. However, it remains unclear whether the reported probe will impact this business relationship.

The investigation into Anchorage Digital Bank highlights the ongoing regulatory challenges faced by the cryptocurrency industry. As digital assets gain mainstream acceptance, regulatory bodies are increasingly focused on ensuring compliance with anti-money laundering standards and other financial regulations. The probe into Anchorage Digital Bank serves as a reminder of the importance of adherence to regulatory requirements for companies operating in the digital asset space.