Biden admin's cold-shoulder approach to crypto concerns industry leaders: 'Needs to be looked at'

Leaders in the cryptocurrency space are up in arms over documents that were recently uncovered showing the Biden administration instructed banks not to engage in cryptocurrency business.

The uncovered documents allegedly confirm suspicions that cryptocurrency tech founders were being "debanked" under a program known colloquially as "Operation Chokepoint 2.0." 

Chris Lane, the former chief technical officer of Silvergate Bank, accused federal regulators of contributing to his bank's collapse after the documents were released Friday. 

"Silvergate became what it was serving cryptocurrency clients," Lane wrote on social media. "[Crypto was a] strategic vertical we started focusing on in 2013. Regulators came in sometime in Spring 2023 and severely limited the amount of U.S. dollar deposits we could hold for digital asset clients. There went our entire business model." 

Lane described the experience as the equivalent of being "shot in the back." 

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Meanwhile, David Sacks, President-elect Donald Trump's new artificial intelligence and crypto czar, said Friday that there were "too many stories of people being hurt by Operation Choke Point 2.0," and that "It needs to be looked at."

Last week, Paul Grewal, the Chief Legal Officer for Coinbase, considered one of the largest cryptocurrency exchange platforms, shared documents that he and his team had obtained following Freedom of Information Act requests that have paralleled a protracted legal battle between the company and the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC). 

The documents showed that the Biden administration's FDIC sent numerous letters to banks, calling on them to "pause all crypto-asset related activity."

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"Law-abiding American businesses should be able to access banking services without government interference," Grewal said Friday in conjunction with his publication of the documents. "The incoming administration has the opportunity to reverse so many poor crypto policy decisions, chief among them politically motivated regulatory decisions like Operation Chokepoint 2.0."

Grewal pledged to continue fighting for transparency, including seeking to obtain copies of the documents without redactions.

Concerns over regulators stifling crypto from engaging with banks gained renewed traction during Thanksgiving week after tech investor Marc Andreessen said on the Joe Rogan podcast that more than 30 tech founders had been "debanked" for political reasons. Andreessen compared what was taking place to a similar Obama-era program known as "Operation Chokepoint," which sought to inhibit high-risk industries like payday lenders and gun dealers.  

Fox News Digital reached out to the FDIC and SEC for comment but did not receive a response by press time.