The vice chairman of the Federal Deposit Insurance Corporation says the regulator needs “new direction” — and he expects it to start later this month.
In a new speech, Vice Chairman Travis Hill acknowledges that the FDIC has sent “pause” letters to more than two dozen banks asking them to stop doing business with crypto companies — a revelation unearthed from a Freedom of Information Act (FOIA) ) request submitted by digital assets. Exchange Coinbase.
According to Coinbase Chief Legal Officer Paul Grewal, the unredacted documents showed a “coordinated effort” to shut down crypto activity in the US.
Says Heuvel,
“I continue to think that it would have been (and remains) a much better approach if the agencies had clearly and transparently described to the public what activities are legally permitted and how they should be carried out in accordance with safety and soundness standards. And if regulatory approvals are required, they must be responded to in a timely manner, which has not been the case in recent years.”
Hill also criticized the U.S. banking industry’s agenda of “debanking,” or deliberately closing or freezing bank accounts of crypto companies. Several high-profile personalities in the crypto space claimed to be victims of the practice.
Hill says the right to a bank account should be fundamental to the modern economy.
“Closely related to the agencies’ recent approach to digital assets is the issue of ‘debanking’. In recent years, there have been several accounts of individuals and companies involved in the crypto industry losing access to bank accounts without explanation. This follows a long history of other types of customers facing the debanking problem, including the politically unfavorable business groups targeted in the original ‘Operation Choke Point’, individuals associated with certain religious or political groups, and many others.”
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