US Lawmakers Wants To Stop Crypto Companies Access To Banking

Key Points:

• Republican members of the House Financial Services Committee in the United States are collecting information on potential concerted action against digital asset providers.
• The politicians aim to restrict digital asset company access to banking for reasons unrelated to bank protection.

Three Republican members of the US House Financial Services Committee, Patrick McHenry, French Hill, and Bill Huizenga, have written to the heads of US banking regulators, including FDIC Chairman Martin J. Gruenberg, Federal Reserve Chairman Jerome Powell, and OCC Acting Comptroller Michael J. Hsu, seeking information on possible coordinated action against digital asset companies.

The letters, dated April 25, included the same content as well as a personalized set of requests to see the agency’s information. These letters come in response to legislators’ March requests for information on the FDIC, Treasury Department, Federal Reserve, and Office of the Comptroller of Currency’s future activities and objectives in relation to the digital asset ecosystem.

The letters started by recounting the Obama Administration’s alleged Operation Choke Point, in which banks were urged to refuse service to specific kinds of businesses.

“Today, we are seeing the resurgence of coordinated action by the federal prudential regulators to suppress innovation in the United States. There is no clearer example than in the digital asset ecosystem.”

The writers, Reps. Patrick McHenry, William Huizenga, and French Hill request non-public materials pertaining to interactions between personnel of the agencies addressed and the institutions they oversee about the papers cited.

The writers of the letters cited OCC Interpretive Letter 1179, the FDIC’s letter from April 2022, and the three agencies’ combined statement from January. Despite routine fraud in the crypto market, they claim that digital asset engagement is not intrinsically risky.

As Coincu reported, The Financial Services Committee of the United States House of Representatives issued a draft version of the historic stablecoin bill. This is the first major piece of crypto legislation to be approved in 2023.

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