Coinbase, the cryptocurrency exchange, has uncovered “over 20 instances” where the United States regulatory body has advised domestic banks to avoid engaging in crypto-related banking services, as stated by its chief legal officer. This revelation comes in the wake of Coinbase submitting two Freedom of Information Act (FOIA) requests to the Federal Deposit Insurance Corporation (FDIC)—the agency responsible for insuring bank deposits—seeking information about the ongoing regulatory crackdown on cryptocurrencies within the banking sector.
Coinbase’s CLO Advocates for Transparency
In a post on X dated November 1, Coinbase’s chief legal officer, Paul Grewal, expressed that the public “deserves transparency, not an agency that operates behind a bureaucratic veil.” He emphasized that the findings reveal numerous instances where the FDIC directed banks to “pause,” “refrain from providing,” or “not proceed” with crypto-banking services.
Grewal further criticized the content of the letters submitted by the FDIC in the court filing on November 1, labeling them as a “shameful example” of a government agency attempting to obstruct financial access for compliant American businesses.
FDIC Questions Banks’ Risk Evaluations
The court documents summarize 23 instances in which the FDIC questioned banks’ evaluations of the risks associated with crypto services, advising them to halt any offerings until a thorough review could be conducted. Many of these cases exhibited similar patterns. For instance, in “Document 5,” the FDIC allegedly convened a meeting with a bank to evaluate its crypto service offerings.
Following the meeting, despite the bank supplying additional documentation, the FDIC reportedly posed further “questions” and advised, “Until such review is completed, the bank should not expand the service to additional customers.”
Meanwhile, on October 30, Cointelegraph reported that Coinbase is “prepared to cooperate with either administration” in the United States, regardless of whether Democratic candidate and Vice President Kamala Harris or Republican Donald Trump emerges victorious in the upcoming presidential election on November 5.