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Trump-era FDIC favourite outlines crypto banking reassessment and end to ‘Operation Choke Point’

Trump-era FDIC favourite outlines crypto banking reassessment and end to ‘Operation Choke Point’

DLNewsDLNews2025/01/11 01:00
By:Kyle Baird

FDIC’s Travis Hill proposes a new direction for crypto banking amid accusations of overreach.

The Federal Deposit Insurance Corporation could set an entirely new course under the upcoming administration.

Vice Chairman Travis Hill recently outlined plans to address contentious cryptocurrency and banking access issues.

Hill, a potential candidate to lead the agency full-time, has criticised the FDIC’s approach to digital assets and the so-called “debanking” of crypto-related firms, signalling a possible end to practices likened to “Operation Choke Point.”

In remarks delivered on 10 January, Hill condemned the FDIC’s past issuance of “pause letters,” which effectively barred banks from offering crypto-related services.

Critics, including Coinbase’s Chief Legal Officer Paul Grewal, argue such actions constitute regulatory overreach, stifling innovation and targeting lawful crypto businesses.

Grewal described the letters as evidence of a “shameful” pattern, while Hill pledged to establish transparent guidelines for blockchain and digital asset activities, reversing what he termed a “damaging” approach.

Hill also called for regulators to adopt clear standards for emerging financial technologies and fintech partnerships.

Debanking, another focal point, has drawn ire from the crypto industry, which claims discrimination against lawful firms.

Hill underscored the need to eliminate practices that deny banking access without explanation, citing the broader economic implications of such measures.

The anticipated shift aligns with President-elect Donald Trump’s broader push for deregulation, as evidenced by recent comments from Federal Reserve Governor Michelle Bowman.

Crypto market movers

  • Bitcoin is down 0.5% over the past 24 hours to trade at $94,050.
  • Ethereum is down 2.2% over the same period to $3,220.

What we’re reading

Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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