Crypto Debanking Wave Sparks Concerns Over Political Influence

By: Isha Das

Coinbase CEO Brian Armstrong has notably taken a stand, suggesting a political influence in the debanking of crypto stakeholders. In a recent disclosure through the Freedom of Information Act (FOIA), Armstrong has called attention to what he perceives as covert efforts by US banks to cut ties with crypto entities. On a platform post dated November 27, Armstrong confirmed that the closure of numerous crypto-related bank accounts aligns with decisions made under political influence, which he labels as unethical, contradicting American values.

Armstrong has gone further to speculate that these decisions are influenced by sentiments from political figures such as Senator Elizabeth Warren and outgoing SEC Chair Gary Gensler. He hinted at a possible role of these actions in the Democratic Party's recent political setbacks, advising the party to reconsider its association with figures he considers a liability.

The crypto community has expressed similar concerns through the notion of "Operation Chokepoint 2.0." This initiative is speculated to be akin to an infamous Obama-era program that targeted controversial or high-risk industries by restricting their access to banking services. Developers like Tornado Cash’s Roman Storm have shared their debanking experiences, shedding light on recurrent financial expulsions without prior notice. Business personalities such as Sam Kazemian from Frax Finance also came forward, recounting their own experiences with major banks like JPMorgan Chase.

Venture capitalist Marc Andreessen echoed these challenges on Joe Rogan’s podcast, where he denounced the alleged expansion of Operation Chokepoint to include crypto and tech sectors. With over 30 reported founders debanked in the last four years, there remains no clear recourse for those affected. The crypto sphere, now familiar with "Operation Chokepoint 2.0," continues to rally against perceived concerted regulatory efforts that aim to destabilize the industry as they seek transparency and accountability from financial institutions.