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FDIC Ordered to Comply with Court Order and Provide More Information on Crypto Debanking
The Federal Deposit Insurance Corporation (FDIC) has been instructed to fully comply with a court order and make more thoughtful redactions to the pause letters requested by crypto exchange Coinbase. This decision comes after Judge Ana C. Reyes flagged excessive redactions made by the FDIC in response to Coinbase’s Freedom of Information Act complaints.
FDIC’s Lack of Good Faith and Compliance
According to Coinbase’s Chief Legal Officer, Paul Grewal, the FDIC’s lack of good faith and subpar compliance with the court order led to the agency withholding relevant information from the industry. This move is seen as a significant development in the ongoing debate about crypto debanking and the role of federal agencies in regulating the industry.
Background on Crypto Debanking
In November 2021, banks began receiving instructions from the current administration to disengage from any crypto services. This move led to the “debanking” of targeted customers and businesses, sparking concerns about the lack of clear rules for digital assets and stifling bureaucracy from agencies like the FDIC.
Industry players, including Coinbase, have accused regulators of waging a “concerted, coordinated campaign” to debank tech innovators and blockchain builders. The recent release of documents by the FDIC has vindicated these claims, showing that the US government ordered banks to suppress crypto.
Unclear Rules and Stifling Bureaucracy
The lack of a standardized framework for digital assets has further beleaguered crypto businesses. Industry players have decried unchecked information restrictions and stifling bureaucracy from agencies like the FDIC.
Tips for navigating the regulatory landscape:
- Stay informed about the latest developments in crypto regulation.
- Understand the role of federal agencies in regulating the crypto industry.
- Monitor the progress of court cases and legal action related to crypto debanking.
“The industry anticipated fairer practices and regulations” following recent federal agency shakeups.
Recent developments have seen the resignation of key regulators, including FDIC chair Martin Gruenberg and Gary Gensler, chair of the Securities and Exchange Commission. The appointment of pro-crypto investor and former regulator Paul Atkin to replace Gensler at the SEC is seen as a positive move for the industry.
Stay up to date with the latest news and developments in the crypto industry on Global Crypto News.
