Federal Reserve Governor Christopher Waller on Friday, U.S. taxpayers warned not to expect sympathy from the government if the prices of the cryptocurrencies they invest in end up crashing.

What happened: Waller too stressed the need for banks to be fully aware of customers’ business models, risk management systems and corporate governance structures to avoid potential losses in the event of a crypto meltdown.

“If people want to hold an asset like this, do it. I wouldn’t, but I don’t collect baseball cards either. However, if you buy crypto assets and the price eventually goes to zero, please don’t be surprised and don’t expect taxpayers to socialize your losses,” he said at the Global Interdependence Center event in California.

Waller added he was concerned about banks engaging in activities that pose increased risks of fraud and fraud, legal uncertainty and the dissemination of inaccurate and misleading financial information.

“Like any customer in any industry, a bank dealing with crypto customers would need to be very clear about the customers’ business models, risk management systems and corporate governance structures to ensure the bank doesn’t keep the bag when there is a crypto meltdown,” he said.

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Why it matters: The governor added that banks considering engaging in crypto-asset-related activities face a critical task of meeting “know your customer” and “anti-money laundering” requirements, which they do not have in any way to ignore.

“So far, the impact of stress in the crypto industry on other parts of the financial system has been minimal. The lack of spillover effects so far may be partly due to the relatively limited number of connections between the crypto ecosystem and the banking system,” he said.

He further noted that it is crucial to ensure the risks to financial stability…