Earlier, the US exchange Coinbase had submitted two new Freedom of Information Act (FOIA) requests to the Federal Deposit Insurance Corporation (FDIC), seeking to disclose relevant documents regarding banks suppressing the cryptocurrency industry. Recently, the FDIC finally released the documents related to “suppressing the crypto industry,” which also sparked a series of doubts about government transparency from crypto industry players. Coinbase’s legal counsel Paul Grewal also condemned the matter on Twitter, stating, “Quite shameful.”
The FOIA documents revealed that the government requested banks to “halt” crypto services
According to the recently exposed “suppression letters” by the FDIC, from March to October 2022, the FDIC sent over 20 letters to multiple banks, requesting them to “halt,” “not provide,” or “not continue” services related to crypto assets. These letters are seen as part of “Chokepoint 2.0” (meaning oppressive policies) aimed at pressuring crypto industry players and stifling the development of the crypto industry. Grewal stated that these letters show the government undermining the financial connections between compliant crypto industry players and consumers in secret.
FDIC “suppression of the crypto industry” documents
Bureaucratic behind-the-scenes operations suppress industry development, Grewal criticizes: Quite shameful
Grewal is very dissatisfied with this matter. He mentioned that such “bureaucratic behind-the-scenes behavior” severely hinders law-abiding players from entering the market and obstructs financial innovation. He further stated, “The public should receive transparent information, not witness the government (FDIC) playing tricks behind the scenes to restrict the legitimate development of the crypto industry, which is quite shameful.”
Although the complete letters have not been fully disclosed, based on the currently exposed content, it can be seen that the FDIC requested banks to pause crypto-related plans and services pending review. Grewal added that Coinbase and other crypto advocacy groups will continue to push for FOIA requests to disclose more relevant documents.
Coinbase’s legal counsel criticizes FDIC on Twitter: Quite shameful!
(Coinbase submits FOIA requests to the Fed and FDIC again, seeking clarification on “bank crypto deposit limits”)