United States President Donald Trump took a significant step against banking practices targeting the cryptocurrency sector.
President Trump aims to end the 'unfair' practices of federal regulatory agencies towards financial institutions working with the cryptocurrency sector with a new presidential decree he signed today.
The information note published by the White House stated, 'The digital assets industry has been the target of unfair disruptions in banking services. Such practices undermine public confidence in the banking system and regulators, jeopardize livelihoods, freeze payroll payments, and impose serious economic burdens on honest Americans.'
With the decree, the concept of reputational risk used by the Federal Reserve in banking supervision is being removed from the supervisory criteria. This concept referred to the likelihood of institutions experiencing customer loss or revenue decline due to negative press or public perception. Although this term is not limited to cryptocurrency, industry representatives argued that this rationale was being used to target crypto companies.
This decision by the Trump administration came after complaints from crypto companies and individuals about the unjustified closure of their accounts by banks in recent times. By fulfilling his promise to end this situation, Trump officially brought an end to the practice referred to as 'Operation Choke Point 2.0' in the industry.
The term 'Operation Choke Point 2.0' was coined in 2023 by Nic Carter, co-founder of Castle Island Ventures, and was compared to the 2013 'Operation Choke Point' from the Obama era. At that time, access to banking services was restricted for sectors deemed to have a high risk of fraud and money laundering.
