Coinbase Urges US to Ease Crypto Banking Rules
Coinbase Calls for Regulatory Reform in US Crypto Banking
Coinbase, a leading cryptocurrency exchange, is advocating for significant changes to US banking regulations concerning digital assets. The company recently sent a letter to key regulatory bodies—the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board of Governors, and the Federal Deposit Insurance Corp (FDIC)—urging them to create a more favorable environment for banks to offer crypto services.
Key Requests from Coinbase
- Allow banks to offer crypto custody and trading services: Coinbase believes banks should be permitted to directly provide these services to their customers.
- Clarify legal standing for state-chartered banks: The company seeks confirmation that state-chartered banks can offer and outsource crypto services under existing laws, addressing concerns raised by an OCC interpretive letter.
- Acknowledge the existing legal framework: Coinbase argues current regulations already permit bank involvement in the crypto space, requesting regulators to officially recognize this.
Coinbase's chief policy officer, Faryar Shirzad, stated, “It’s important for regulators to make clear that banks can work with third-party providers in providing trading and exchange services to their customers.” This push is supported by three prominent law firms.
Context: Operation Choke Point 2.0 and Crypto Debanking
This action comes amidst an ongoing House Oversight Committee investigation into Operation Choke Point 2.0. This investigation examines allegations of regulatory actions restricting banking access for cryptocurrency firms. The FDIC and other agencies are reportedly applying informal pressure, encouraging banks to limit services to perceived high-risk industries, including crypto.
Coinbase has presented evidence, including internal documents, indicating that the FDIC actively discouraged banks from providing crypto services. These documents reportedly showed requests for banks to "pause" crypto-related activities.
Coinbase's legal chief, Paul Grewal, and MARA Holdings CEO, Fred Thiel, will testify before the House Financial Services Committee’s Subcommittee on Oversight and Investigations on Thursday. Their testimony will focus on the alleged systematic debanking of crypto firms under the current administration.
Codeum’s Note: At Codeum, we are committed to securing the future of blockchain. We offer a range of services including smart contract audits, KYC verification, custom smart contract and DApp development, tokenomics and security consultation, and partnerships with launchpads and crypto agencies. We believe a clear and transparent regulatory framework is crucial for the responsible growth of the cryptocurrency industry.