Coinbase confirmed on Friday that newly disclosed correspondence between the Federal Deposit Insurance Corporation (FDIC) and its member banks would help prove that the US government was conducting secret transactions. War on crypto for years.
But what exactly do the documents show?
Coinbase is long Pushed. To explain how the FDIC is dealing with US banks about crypto. On Friday, the company and the public got some answers to that question, when the FDIC published 23 letters it sent to crypto member banks in 2022, complying with a request made by Coinbase under the Freedom of Information Act (FOIA).
of LettersThe heavily redacted document shows how the FDIC has ordered banks to refrain from offering crypto-related products and services until the agency decides how best to regulate them.
The FDIC told one bank in March 2022, “We respectfully request that you suspend all activities related to crypto asset-related activity.”
The letters They show that in 2022, the FDIC issued several such complaints to banks across the United States.
Previously, the FedDC He gave instructions It is not clear whether the FDIC is ordering banks to stop this activity, with all banks under its supervision to immediately notify the agency of any plans to engage in “crypto-related activities” by early 2022.
In several FDIC letters published Friday, the agency said it will make a decision on whether such crypto-related activity is permitted only after it completes a detailed review. The letters do not say whether the FDIC has completed such a review or what the conclusion of the process might be.
Coinbase's chief legal officer, Paul Grewal, celebrated the revelations on Friday, saying that X (formerly known as Twitter) confirms the existence of “Operation Chokepoint 2.0,” a long-standing theory among crypto leaders that the US government has prevented major financial institutions from operating in crypto for years. Not only did he hope, he also put crypto companies and executives out of business in an attempt to stifle the industry.
“Law-abiding American businesses should be able to access banking services without government interference,” Grewal wrote on X on Friday.
But none of the FDIC's letters published Friday mention any policies related to bank withdrawals for crypto-involved customers. It seems only to discuss the prospect of US banks offering crypto-related services themselves.
Decrypt He reached out to Coinbase regarding that potential tension; Company spokesperson Grewal's X post has stated the company's position on the matter.
A source familiar with the company's thinking told Decrypt that while the FDIC's letters did not specifically address issues related to debanking, it can be inferred that banks concerned about following the agency's directives may have closed bank accounts to stop “crypto-related activities.” crypto companies and executives, to proactively ensure they don't get into trouble or lose FDIC backing.
“Imagine the uncertainty those banks must feel when they receive these letters,” the source said.
The source added that while they find the revelations in Friday's FDIC letters “remarkable,” they are confident there is more evidence directly linking crypto leaders to US government directives.
A number of crypto industry founders and executives have traded their own personal and corporate debanking stories in recent days. Andreessen Horowitz founder Marc Andreessen spoke on Joe Rogan's podcast last week about more than 30 industry founders who lost their bank accounts during Joe Biden's presidency.
Several crypto industry leaders, including Custodia Bank CEO Caitlin Long and Coinbase's own CEO Brian Armstrong, soon responded by sharing their experiences of being fired.
It is certainly plausible that those instances may have been related to the FDIC's pushback, as described in the letters released Friday. Excerpts from those letters published today don't quite make that connection, but Coinbase and other industry leaders are still looking for that smoking gun.
Edited by Andrew Hayward.
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