cryptojournalist
Regulators Demand a Halt
Court records from a FOIA lawsuit reveal that in 2022, the FDIC urged certain banks to halt all cryptocurrency-related activities due to unclear regulations on digital assets. The letters, sent to unnamed banks, promised further guidance on compliance expectations and required filings.
The lawsuit, filed by History Associates on behalf of Coinbase, aimed to uncover whether federal regulators were pressuring banks to sever ties with crypto firms through “debanking” tactics.
Claims of Targeted Crypto Restrictions
Paul Grewal, Coinbase’s chief legal officer, stated that the FDIC’s letters support allegations of a covert effort, referred to as “Operation Chokepoint 2.0,” to isolate crypto businesses. He criticized the FDIC for redacting key information, claiming it obscures the full extent of the campaign.
The term “Operation Chokepoint” originally described a 2013-2017 initiative that pressured banks to avoid high-risk industries like payday lending. Crypto executives now allege a similar effort is targeting digital asset companies, with some reporting that banks threatened account closures in 2023.
Leadership Uncertainty at FDIC
FDIC chair Martin Gruenberg is set to retire on January 19, leaving uncertainty over the agency’s future stance on cryptocurrency. No successor has been announced, adding to questions about the regulatory direction under the new administration.
