US Republicans seek transparency over alleged coordinated crypto de-banking
The US House Financial Services Committee’s Republican members seek transparency concerning the de-banking of various cryptocurrency businesses.
On April 25, three Republican representatives from the US House Financial Services Committee sent letters to the heads of US banking regulatory agencies seeking information about any possible coordinated actions against digital asset firms.
The letters were addressed to Federal Deposit Insurance Corporation (FDIC) chair Martin J. Gruenberg, Federal Reserve System chair Jerome Powell, and Office of the Comptroller of the Currency (OCC) acting comptroller Michael J. Hsu.
The lawmakers’ latest epistles are a sequel to previous missives they had dispatched to the same destinations. Although the letters shared the exact text, each demanded personalized access to the agencies’ records.
The letters began by invoking the Obama Administration’s Operation Choke Point, which allegedly urged banks to shun some enterprises. The authors then warned of a “resurgence of coordinated action” by the federal prudential regulators to stifle innovation in the US, with the digital asset ecosystem bearing the brunt of the onslaught.
The letters’ authors, Reps. Patrick McHenry, Bill Huizenga, and French Hill cited OCC Interpretive Letter 1179, FDIC’s April 2022 letter, and the joint statement issued by the three agencies in January as examples. The trio argued that, despite the crypto industry’s “run-of-the-mill fraud,” digital asset activity is not inherently risky.
Moreover, the lawmakers allege that the Fed, FDIC, and OCC’s actions do not stem from recent events or a sudden urge to protect financial institutions from risky behavior. Instead, they imply that there is a coordinated plot to shun the digital asset ecosystem in the US.
The lawmakers demand non-public records about communications between the agencies’ staff and the institutions they oversee, specifically those referenced in the documents.