EddieJayonCrypto
3 Jan 25
The Federal Deposit Insurance Corporation (FDIC) has discouraged American banks from offering services built on public blockchain networks. Documents obtained by cryptocurrency exchange Coinbase through the Freedom of Information Act reveal that the FDIC has instructed member banks to undergo a deta...
The Federal Deposit Insurance Corporation (FDIC) has instructed American banks to undergo a detailed review process before offering services built on public blockchain networks. Cryptocurrency exchange Coinbase obtained unredacted documents through the Freedom of Information Act, revealing the FDIC’s stance on public blockchains.
According to the documents, the FDIC has discouraged banks from implementing services related to buying and selling Bitcoin, indicating a coordinated effort against the crypto industry, allegedly part of a banking regulation initiative known as "Operation Chokepoint 2.0."
One of the disclosed letters, sent in March 2022 from the FDIC’s New York office to a member bank, detailed the agency's disapproval of the bank's plan to roll out a “Bank Digital Deposit” program on a public blockchain. The FDIC emphasized its preference for private, permissioned networks over fully transparent, decentralized blockchains like Ethereum and Solana.
Additional letters revealed the FDIC's directive to member banks to halt the implementation of services related to cryptocurrencies. Coinbase's Chief Legal Officer characterized these revelations as evidence of a purported Biden administration initiative aimed at impeding crypto activity through banking regulations, referred to as “Operation Chokepoint 2.0.”