20 Secretive Regulator Moves Targeting Crypto in Operation Chokepoint 2.0

Newly surfaced documents reveal over 20 cases where regulators allegedly pressured banks to halt crypto services, raising concerns of a covert crackdown

Coinbase’s legal chief has accused U.S. regulators of targeting crypto firms in a covert crackdown.

Coinbase CLO Highlights 20 Regulator Moves vs. Crypto in 'Operation Chokepoint 2.0'

Coinbase (NASDAQ:COIN) chief legal officer Paul Grewal disclosed on social media platform X on Friday findings related to what he describes as “Operation Chokepoint 2.0,” a government effort he argues aims to restrict financial access for compliant American crypto companies.

The revelations emerged from a Freedom of Information Act (FOIA) lawsuit filed by Coinbase, which required the Federal Deposit Insurance Corporation (FDIC) to release details about its “pause letters” sent to financial institutions. According to Grewal, these letters show the regulator specifically targeting crypto banking services, supporting his claims of a coordinated government initiative against the crypto industry.

“The contents are a shameful example of a government agency trying to cut off financial access to law-abiding American companies,” Grewal remarked, adding:

“So far we’ve uncovered more than 20 examples of the FDIC telling banks to ‘pause’ or ‘refrain from providing’ or ‘not proceed’ with offering crypto-banking services.”

“The public deserves transparency, not an agency that’s working behind a bureaucratic curtain,” the Coinbase legal chief stressed.

Coinbase had previously filed a FOIA lawsuit over the FDIC’s “pause letters,” which regulators use to direct banks to halt services to certain industries. While a judge ruled in March that the letters are subject to public disclosure, the agency has been slowly releasing the documents.

Although Coinbase has yet to secure the complete set of letters, Grewal expressed that what has been revealed so far is significant. He affirmed Coinbase’s commitment to obtaining full disclosure through FOIA and “any other means necessary,” sharing a link to the partially released documents to promote public examination of the FDIC’s actions.

The term “Operation Chokepoint 2.0” references federal attempts to limit crypto firms’ access to banking services, similar to the original 2013 Operation Chokepoint. The initial program, discontinued in 2017, faced criticism for pressuring banks to exclude “high-risk” industries, like payday lending and firearms, deemed lawful. Crypto advocates argue that the FDIC, along with the Federal Reserve and Office of the Comptroller of the Currency (OCC), may now be exerting similar pressure against cryptocurrency firms despite their legal compliance.