Crypto companies may soon find themselves deprived of banking services in the United States, just like online poker was during the Obama era, says Nic Carter.
Castle Island general partner Nic Carter believes the crypto industry is under attack by the U.S. government.
In a Substack post published yesterday, Carter claimed that the Biden administration was currently “using the banking sector to organize a sophisticated, widespread crackdown against the crypto industry” by discouraging banks from doing business with crypto companies.
According to Carter, the government’s approach replicates a strategy employed by the Obama administration, named Operation Choke Point, which sought to marginalize specific industries by restricting their access to banking. Impacted industries included the online poker industry, firearms manufacturers, adult entertainers, lotteries, and money transfer networks.
With regards to the crypto space, Carter listed 14 instances in the last 10 weeks in which crypto-friendly banks had faced pressure from the government—or had otherwise elected to stop providing services to crypto companies. He claimed that influential members of Congress, the Federal Reserve, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Department of Justice were implicated in what he called Operation Choke Point 2.0.
Notable among these events were statements made by the Fed, the FDIC, the OCC, and the National Economic Council strongly discouraging banks from holding crypto or dealing with crypto clients on a “safety and soundness” basis. The Fed’s rejection of Custodia’s application to become a member of the Federal Reserve, the DOJ investigation into Silvergate, and Signature and Metropolitan Commercial Bank’s decision to significantly reduce (or completely shut down) their crypto services were also mentioned.
“Time and again, using the expression ‘safety and soundness,’ [the government has] made it clear that for a bank, touching public blockchains in any way is considered unacceptably risky,” stated Carter, adding that while banks are not explicitly banned from servicing crypto clients, “the writing is on the wall.”
Carter’s words were echoed by Blockchain Association lawyer Jake Chervinsky, who stated on Twitter that federal agencies had “weaponize[d] control over the banking system to mandate discrimination against crypto companies.”
Disclaimer: At the time of writing, the author of this piece owned BTC, ETH, and several other crypto assets.
The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.
You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.
See full terms and conditions.
News Sep. 16, 2022
The White House has indicated that it wants to protect consumers, fight financial crime, and look into launching a digital dollar. White House Publishes Crypto Framework The U.S. government is...
The Biden administration has issued an executive order that will help determine the U.S. government’s crypto policy in the months ahead. Order Will Create New Policies Early today, President Joe...
Introducing a “digital dollar” central bank digital currency would radically change how the world interacts with money, and based on recent developments, the U.S. seems to be open to the...