FDIC Releases Documents on Crypto Debanking Ahead of Congressional Hearing
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Just ahead of the scheduled congressional hearing on banking practices and financial access, the Federal Deposit Insurance Corporation (FDIC) released 175 documents related to its supervision of banks that engaged in, or sought to engage in, crypto-related activities as per a recent press release.
Banks Halted Crypto Activities Due To Regulatory Obstacles
Acting FDIC Chairman Travis Hill said that releasing these documents will improve transparency. The move also seeks to go beyond the requirements of the Freedom of Information Act (FOIA). He also noted that the documents show that banks faced significant resistance, including repeated requests for more information, long delays, and directives to pause or limit their crypto and blockchain activities. These actions made it extremely difficult for banks to move forward. As a result, the vast majority of banks simply stopped trying.
The FDIC had earlier shared 25 “pause” letters sent to 24 institutions exploring blockchain and crypto. The new documents include more correspondence with these institutions and additional communications with other banks that were not previously listed.
Is This The End Of Operation Chokepoint 2.0?
Besides, Senator Lummis also praised FDIC’s swiftness in releasing the documents. “We are putting an END to Chokepoint 2.0,” she exclaimed.
The document release comes ahead of a scheduled congressional hearing on banking practices and financial access. The hearing will likely address concerns about the FDIC’s past approach to crypto-related activities and wider issues around regulatory oversight of financial institutions.
FDIC Reassessing Its Approach To Crypto Supervision
The FDIC is reassessing its approach to crypto supervision and aims to allow institutions to work with crypto and blockchain while ensuring safety. Additionally, the FDIC looks forward to collaborating with the President’s Digital Asset Markets Working Group, created by the January 23, 2025 Executive Order.
