Ah, the ever-bewildering saga of certain US government agencies, those elusive phantoms of transparency! It is said that they continue to resist the bright light of day, particularly in connection with the notorious Operation Chokepoint 2.0. This rather unfortunate episode unfolded during the Biden administration, wherein the banking services seemed to play a game of hide-and-seek with crypto and tech founders, as recounted by none other than Paul Grewal, the chief legal mind of Coinbase.
The sudden collapse of crypto-friendly banks in early 2023 ignited the initial murmurs surrounding this operation. Critics, including the ever-astute venture capitalist Nic Carter, have boldly portrayed it as an insidious governmental maneuver to pressure banks into severing ties with those pesky cryptocurrency firms. Oh, how noble!
Despite newly minted regulatory shifts — a veritable bouquet of hope, one might say — stalwarts of unyielding opacity, like the Federal Deposit Insurance Corporation (FDIC), have chosen to remain steadfast in their “resistance” towards basic transparency efforts, as eloquently articulated by Mr. Grewal in a post on the great digital platform known as X, on this very day, March 8.
“They haven’t gotten the message,” he lamented, one imagines with an air of bemusement.
In an attempt to pry open the treasure chest of bureaucratic secrets, Coinbase has dutifully requested that the FDIC disclose how it conducted “due diligence,” ensuring that no illuminating documents pertaining to this grand debacle were conveniently misplaced or otherwise vanished into the ether. Alas, the agency has “repeatedly refused to do so.” How charmingly evasive!
Only a day prior, the United States Office of the Comptroller of the Currency (OCC) acquiesced, easing its stance on how banks should divert their gaze toward crypto engagement. This most fortuitous turn of events occurred mere hours after former President Donald Trump rose like a phoenix, vowing to bring an end to the prolonged crackdown – a veritable bureaucratic blockade — which had hitherto restricted crypto firms’ access to banking services.
Trump, in his usual flair during the White House Crypto Summit, fervently proclaimed that he was “ending Operation Chokepoint 2.0.” Let us not forget the collective gasp that must have echoed through the hallowed halls of finance!
As the tale unfolds, it becomes apparent that at least 30 tech and crypto founders found themselves “secretly debanked” within the borders of the US during the aforementioned operation, according to CryptoMoon, a publication that appears to have a keen eye for detail.
FDIC’s Delightful Snip of FOIA Requests
Mr. Grewal has also noted, with something akin to a wry smile, that the FDIC has not engaged in full cooperation with Coinbase’s attempts to unveil documentation under the revered Freedom of Information Act (FOIA):
“[…] the agency has produced only snippets from a few documents that have little to nothing to do with the specific FOIA policies or practices that History Associates has challenged in its amended complaint. What exactly are they hiding?”
Moreover, it appears that the FDIC has redacted a staggering 53 pages, many of which are so heavily redacted that they emerge resembling a construction site — unintelligible, chaotic, and rather amusing if one gazes at it in the right light.
Indeed, Grewal’s team humbly requested a “sworn testimony” from the FDIC. Dear readers, if one could commend the audacity!
On March 4, Coinbase sought the details of investigations and enforcement actions against crypto firms from the Securities and Exchange Commission (SEC) — a quest rendered perilous by the temporal boundaries of April 17, 2021, and January 20, 2025.
It is worth mentioning that Trump, in a characteristic burst of regulatory zeal, had previously signed an executive order aimed at alleviating certain banking challenges beleaguering Web3 companies while manifesting clearer regulations for digital assets. A veritable fairy tale of financial reform came to light on January 24!
This jolly executive order excludes the Federal Reserve and the FDIC from cryptocurrency working groups, a move posited by none other than Caitlin Long, founder and celestial guide of Custodia Bank, as a potential coup de grâce against prior industry debanking efforts. Truly an impending era of clarity or merely a mirage?
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2025-03-08 13:01