Coinbase Chief Legal Officer Paul Grewal reveals that the Federal Deposit Insurance Corporation (FDIC) has urged banks to stop or avoid offering crypto-related services as well as simply Bitcoin (BTC). shared a document.
A letter is an unedited version of a document share Published by Grewal on December 6, 2024. These were called “suspension letters” because they repeatedly recommended suspending or refraining from using cryptocurrency services.
Guruwal says:
“They demonstrate a coordinated effort to thwart a wide range of cryptocurrency activity, from basic BTC transactions to more complex services.”
These letters follow a Freedom of Information Act (FOIA) request filed by Coinbase on October 18 seeking clarification regarding the alleged 15% deposit cap imposed on crypto-friendly banks. It is.
The FDIC responded to the request in December 2024, but the document was heavily redacted. As a result, Coinbase created a new request to access a version with more accessible parts.
Grewal added that the FDIC found two additional letters in the new request, which asserted that new information would come to light as clarifications were sought, and that they should be sent to Congress “without delay.” He urged a public hearing to begin.
He previously said the letter proves the importance of Operation Chokepoint 2.0. The operation is described as an effort by President Joe Biden's administration to hinder the growth of the U.S. cryptocurrency industry by restricting access to banking services.
FDIC response
In response, the FDIC issued a 2022 internal memorandum from its Division of Risk Management and Supervision detailing how supervisors should approach banks planning to offer virtual currency services.
Although Grewal’s letter makes clear that the FDIC has urged banks to avoid expanding into cryptocurrencies, the FDIC’s recommendations do not explicitly communicate that to regulators. .
Additionally, the FDIC document includes a draft document that regulators can use to respond to banks that notify them of their involvement in cryptocurrencies. The draft is similar to parts of the letter shared by Mr. Grewal.
as Reuters reported In December 2024, FDIC Chairman Martin Gruenberg stated that the FDIC is not preventing crypto companies from accessing banking services. However, banks involved in virtual currencies will be “subject to supervisory attention.”
US crypto industry insiders prioritize access to banking services and look forward to President-elect Donald Trump address that issue on his first day in office.
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