Coinbase executive Paul Grewal has unveiled documents exposing the U.S. government’s regulatory pressure on cryptocurrencies. These confidential documents, released under Coinbase’s Freedom of Information Act (FOIA) request, confirm that the Biden administration suppressed cryptocurrencies in 2022.
Coinbase Executive Publishes FDIC Letters
The term Operation Chokepoint 2.0, widely used to describe regulatory pressure on cryptocurrencies in the U.S., has been validated by the latest documents shared by Coinbase executive Paul Grewal. The letters, dating back to March 11, 2022, reveal efforts by the Biden administration to suspend participation in crypto-related services.
The documents highlight the administration’s lack of clarity on regulatory requirements for cryptocurrencies. One excerpt notes:
“At this time, the FDIC has not yet determined what regulatory filings will be necessary for a bank to engage in this type of activity.”
Grewal, via his X (formerly Twitter) account, stated:
“The letters confirm that Operation Chokepoint 2.0 is real. The FDIC continues to hide behind excessive redactions and has only provided a fraction of the relevant documents.”
Paul Grewal: Operation Chokepoint 2.0 is Real
The release of these documents was facilitated by Coinbase’s FOIA request filed on October 18, seeking clarity on an alleged 15% deposit cap imposed on crypto-friendly banks.
Grewal claimed that these letters are part of an initiative named “Operation Chokepoint 2.0,” aimed at suppressing the crypto sector. He emphasized that these claims are not conspiracy theories and criticized the FDIC for concealing crucial information and only sharing a small portion of the relevant data.
Grewal urged the incoming U.S. administration to reverse what he described as “politically motivated regulatory decisions,” stating:
“The new administration has an opportunity to reverse poor crypto policies, particularly politically driven regulatory decisions like Operation Chokepoint 2.0.”
Coinbase Revelation Gains Industry Support
Other figures in the crypto industry also criticized the letters and questioned the Federal Reserve’s involvement in the process. Caitlin Long, CEO of Custodia Bank, argued that these letters were part of a coordinated decision by the Fed.
Long stated that these letters were not mere suspension recommendations but were designed to legally block crypto activities under the guise of “cease and desist” directives:
“These weren’t ‘pause letters’ because the pause was indefinite. These were ‘cease and desist’ letters cloaked in legalese… designed to crush lawful crypto activities.”
The letters, spanning nearly two years, indicate a coordinated effort among regulators to restrict banks’ participation in crypto-related activities. Critics argue that such measures stifle innovation and hinder the ability of the crypto industry to grow within the U.S. financial system.
As tracked by Kriptokoin.com, the Trump administration had adopted a more favorable stance toward cryptocurrencies.
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