The enforcement action taken by the United States Federal Reserve against the crypto-friendly Customers Bank has sparked speculation that Vice President Kamala Harris' presidential campaign may not be genuine in its efforts to mend relations with the cryptocurrency industry.
On Aug. 9, Gemini co-founder Tyler Winklevoss took to X to highlight the Fed's actions. "Today, the Fed confirmed that Operation Choke Point 2.0 remains in full swing, provided valuable insight into how it works, and verified that the Harris crypto 'reset' is a scam," Winklevoss said.
Crypto Banking Crackdown
The Fed's 13-page enforcement action against Customers Bank mandates it to provide a 30-day advance notice before entering any new banking relationship with a cryptocurrency company. Winklevoss highlighted the broader implications of the enforcement action, stating that Customers Bank is one of the few remaining crypto-friendly banks in the United States. He said that the Federal Reserve is now controlling access to banking services for crypto companies, essentially deciding who can and cannot open a bank account, thereby limiting their ability to operate.
Winklevoss criticized the centralization of decision-making power within the Fed, arguing that such decisions should be decentralized across the banking industry and made at each bank's discretion.
Industry Reactions
In response to Winklevoss' statement, Cardano founder Charles Hoskinson echoed the sentiment that the current US administration is hostile toward the crypto industry. Hoskinson believes President Joe Biden's administration is actively working against the crypto industry, and this stance has not changed. He warns that voting for Harris would harm the US crypto industry, implying that she would continue this perceived "war on crypto."
In a letter sent to Democratic National Committee Chair Jaime Harrison in July, a group of US lawmakers and congressional candidates from various districts called on party leaders to adopt a progressive stance on digital assets and blockchain technology.
Between March and August 2023, the US banking sector faced a tumultuous period marked by the downfall of several banks that catered to crypto businesses, including Silvergate Bank, Signature Bank and Silicon Valley Bank.
The enforcement action against Customers Bank raises critical questions about the future of cryptocurrency banking in the United States. As the Federal Reserve tightens its grip on banking relationships with crypto firms, the landscape for digital assets may become increasingly precarious. Industry leaders are concerned that such regulatory measures could stifle innovation and drive crypto businesses to seek more favorable environments abroad.
