Operation Choke Point 2.0: New Crypto Crackdown Is Underway

Prominent figures within the crypto community are raising alarms over what appears to be a new wave coordinated effort by US banks to systematically dissociate from businesses dealing in digital currencies. Operation Choke Point 2.0 which began last year, is a concerted government effort involving the Biden White House, several agencies, the Federal Reserve and influential members of Congress that aims to restrict crypto’s fiat access, thus potentially suffocating the industry.

Operation Choke Point 2.0 Underway Again

The recent outcry was ignited by John Paller, the founder and Executive Steward of ETHDenver and Opolis, who shared his personal ordeal with Wells Fargo on X (formerly Twitter). Paller detailed how, after “26 YEARS of patronage,” Wells Fargo abruptly terminated all of his accounts, including personal, business, and non-profit without providing a clear explanation.

How To Get Free Crypto  

Paller’s relationship with the bank, which involved millions in fees over the years, was severed in a manner that left him questioning the motives behind the bank’s decision. He said, “I suspect that it’s because my name was all over the Opolis accounts that were also closed last year due to crypto affiliation although we were told it was some other BS reason.”

Gabor Gurbacs, founder of PointsVille and advisor to Tether and VanEck, corroborated Paller’s assertions, confirming an industry-wide phenomenon of “quietly de-platforming businesses that have anything to do with crypto, even services.” Gurbacs added, “Operation chokepoint 2.0. is back.” This statement points to a broader, systemic issue within the banking industry, which seems to be acting in a concerted manner against the cryptocurrency sector.

The situation took on further gravity with Caitlin Long, CEO of Custodia Bank, entering the conversation. Long, a veteran in the blockchain space and founder of a bank that aims to bridge cryptocurrencies with traditional banking, reported an uptick in inquiries from crypto companies displaced by their banks.

“John—sorry to hear. Custodia has seen a marked uptick in inquiries in the past ~2 weeks from #crypto companies urgently seeking to replace bank accounts closed by their banks,” she said, suggesting an orchestrated effort against the industry.

Coinbase Banner  

Long’s insights underline a disturbing trend of financial exclusion that is not only immediate in its impact but also suggestive of a larger, perhaps politically motivated, campaign against crypto enterprises. Yesterday, Long reiterated via X:

CONFIRMED. There is *definitely* a witch hunt underway to debank fintech & crypto companies in the US. It’s very political. It’s illegal, wrong & may violate the FDIC’s 2019 Operation Choke Point lawsuit settlement. Debanking should be an election issue in November.”

Custodia Bank Fights For The Crypto Industry

Adding to the controversy is Custodia Bank’s own legal battle for banking equality. The bank’s quest for a Federal Reserve master account — a pivotal asset for any banking institution seeking autonomy from intermediaries — was recently thwarted. A federal judge in Wyoming ruled against Custodia, asserting that the Federal Reserve is not compelled to grant access to its master account system to every eligible depository institution.

This decision was met with criticism from various quarters, including SkyBridge’s Anthony Scaramucci and former Senator Pat Toomey, who perceived it as a setback for the crypto industry’s broader ambitions for integration within the traditional financial system.

Scaramucci, via X, criticized the Kansas City Federal Reserve’s rejection of Custodia’s application as “arbitrarily and capriciously” motivated by a distaste for crypto. “Judge […]did a complete 180 on the prior decision. Raises major questions about legality of Fed and potential political pressure from Sen E. Warren acolytes.

FreeBitcoin Banner  

Similarly, Toomey expressed his dissatisfaction with the legal outcome, telling FOX Business, “it was contradictory and inconsistent with his decision in June when he denied the Fed’s request to dismiss the case. There’s no logic here at all, and I hope Custodia decides to appeal.”

At press time, Bitcoin traded at $66,771.

BTC price, 4-hour chart | Source: BTCUSD on TradingView.com

Featured image from New York Magazine, chart from TradingView.com

Go to Source
Author: Jake Simmons

Recommended Crypto Services, Products and Strategies:

The first thing any crypto investor needs is is a reliable and secure Crypto Wallet.  Whether you’re looking for an online wallet, hardware wallet, desktop or mobile wallet, Crypto Renegade provides you with all the Best Crypto Wallets in each category.

Best Crypto Wallets Banner

When you’re ready to buy more crypto, or exchange your coins for others, Crypto Renegade’s list of the Best Crypto Exchanges has you covered.  The Crypto Exchanges recommended here offer everything from simplicity and convenience to advanced trading platforms and profit sharing. 

Best Crypto Exchanges Banner

If you want to learn more about the methods and tools that can be used to find Great Crypto Projects, then be sure to check out Crypto Renegade’s strategy for How To Find The Best Cryptocurrency.

Crypto Strategy Banner

For those people that don’t have any money to invest right now, or just want to understand the technology a bit more, you’ll definitely want to check out Crypto Renegade’s Free Crypto Strategy and start collecting Free Coins today!

Free Crypto Banner

What do you think about cryptocurrency? Do you have any questions about it? Be sure to leave a comment below.

You May Also Like

More From Author

This site uses Akismet to reduce spam. Learn how your comment data is processed.