The Federal Deposit Insurance Corporation (FDIC) released today 175 more documents that expose how banks attempting to explore crypto were blocked, delayed, and outright ignored under federal supervision.
The document dump comes ahead of today’s Senate Banking Committee crypto debanking hearing, where GOP leaders are gonna grill the agency on its past anti-crypto shenanigans under former president Joe Biden.
Acting FDIC Chairman Travis Hill, the man now tasked with fixing this mess, is calling out the FDIC for creating the perception that banks interested in blockchain or distributed ledger technology weren’t welcome. And now, with the GOP in charge, the dirty laundry is being aired for everyone to see.
The documents include internal communications, letters, and endless back-and-forths between banks and FDIC officials. And they all prove that banks trying to dip into crypto were often met with silence, repeated requests for additional information, or outright orders to hit the pause button. Hill said the outcome was inevitable—most banks simply quit trying.
The FDIC previously released 25 letters, referred to as “pause” orders, sent to 24 banks warning them to pause or delay their crypto expansion plans. But these new documents blow the lid off the extent of the resistance.
Hill acknowledged that these communications show a clear pattern of regulatory pushback. Many banks faced months of silence after their initial proposals. Others received direct instructions to “pause, suspend, or refrain from expanding all crypto- or blockchain-related activity.”
“The vast majority of banks just stopped trying,” Hill admitted. He confirmed that the FDIC will toss out Financial Institution Letter (FIL) 16-2022, the guideline that essentially made banks think twice about touching crypto.
A new framework will be developed to allow banks to participate in the digital asset economy without compromising safety and soundness principles. Hill also said the FDIC would work closely with the President’s Working Group on Digital Asset Markets, which was set up under Trump’s January 2025 executive order.
Elizabeth Warren pressures Trump, cites thousands of debanking cases
But as Hill tries to repair the damage, Senator Elizabeth Warren (who is the Senate Banking Committee’s ranking member) is taking a different approach by going after the White House.
She sent a letter to President Donald Trump demanding that he take immediate action to stop what she called the “debanking of Americans.” Her letter came armed with facts—thousands of complaints from consumers who had their accounts shut down by major banks in recent years.
Warren’s analysis revealed that more than half of the complaints were tied to just four financial giants: Bank of America, JPMorgan Chase, Wells Fargo, and Citigroup.
Trump, for his part, has already expressed disapproval of debanking. Speaking at the World Economic Forum just a week ago, he criticized the practice and later signed an executive order calling for fair access to banking services for all law-abiding citizens.
But Warren wants to work directly with President Trump and Senate Banking Chair Tim Scott to tackle the issue head-on.
She explained five steps the Consumer Financial Protection Bureau (CFPB) should take to address the crisis. Banning contract clauses that allow banks to shut down accounts over customers’ political or religious beliefs, limiting overdraft fees to $5, and cracking down on discriminatory debanking practices, according to Warren.
The Senator also called for tighter supervision of large payment apps like PayPal and CashApp, where many debanking cases often fly under the radar.
Meanwhile, Mike Ring, CEO of Old Glory Bank, has said today that regulators coordinated across agencies (the FDIC through ‘FIL-16-2022’ and the SEC through ‘SAB 121’) to “choke out” American banks acting as crypto custodians and to stop the demand for deposit services. He added that it couldn’t have been a coincidence that the agencies put these directives out at the same time in April 2022.
Cryptopolitan Academy: FREE Web3 Resume Cheat Sheet – Download Now
News – Cryptopolitan – Read More