The Federal Deposit Insurance Corporation (FDIC) is facing criticism for its lack of transparency in connection to Operation Chokepoint 2.0. This period, under the Biden administration, saw crypto and tech founders allegedly barred from accessing banking services. Paul Grewal, Coinbase’s Chief Legal Officer, is among those voicing their concerns.
During the early part of 2023, the downfall of crypto-friendly banks prompted the first accusations of Operation Chokepoint 2.0. Critics like venture capitalist Nic Carter viewed it as an attempt by the government to coerce banks into severing connections with cryptocurrency firms.
Even with recent regulatory changes, the FDIC and other agencies continue to “oppose basic transparency,” as stated by Grewal in a March 8 post on X. “They just don’t seem to get the message,” he added.
Coinbase has called on the FDIC to reveal in court how it performed “due diligence” to avoid the destruction of any related documents. Grewal claims that the agency has “consistently declined” to comply.
These comments followed the US Office of the Comptroller of the Currency (OCC) softening its stance on banks’ interaction with crypto. This happened just hours after President Donald Trump pledged to put an end to the ongoing crackdown hampering the ability of crypto firms to access banking services. Trump made these remarks during the White House Crypto Summit, declaring an end to Operation Chokepoint 2.0.
During Operation Chokepoint 2.0, approximately 30 tech and crypto founders in the US were “secretly debanked,” as reported by Cointelegraph in November 2024.
Grewal also accused the FDIC of not fully cooperating with Coinbase’s Freedom of Information Act (FOIA) documentation requests. He stated that the FDIC has produced only partial documents with little relevance to the specific FOIA policies or practices challenged by History Associates in its amended complaint. Grewal questioned, “What exactly are they hiding?”
Grewal’s team has requested a “sworn testimony” from the FDIC, given the heavy redactions in the documents provided, making them almost incomprehensible.
On March 4, Coinbase also submitted a FOIA request to the Securities and Exchange Commission (SEC) to learn about the number of investigations and enforcement actions against crypto firms between April 17, 2021, and January 20, 2025.
Earlier, Trump had signed an executive order to alleviate some banking difficulties for Web3 companies and establish clearer regulations for digital assets. This order excluded the US Federal Reserve and FDIC from cryptocurrency working groups, potentially ending the prior debanking efforts in the crypto industry, as reported by Cointelegraph on January 24.
