The crypto industry remains on the cusp of potential overarching regulations and scrutiny from regulators across the globe. This is especially true in the United States, where federal watchdogs are trying to clamp down on crypto in an operation referred to as ‘Choke Point 2.0.’
In 2022, the crypto industry suffered multiple institutional collapses that wiped out billions of dollars from the market. This caused many customers of these platforms to lose everything they had, forcing regulators to step in and crack down on the industry.
Elliptic, a blockchain analytics firm, published Извештај detailing its prediction for crypto regulations this year. The firm said 2023 would see increased sanctions in the crypto space as global regulators tightened regulations in the industry—and it was right on the money.
The Evolution of Operation Choke Point
The U.S. government has especially begun accelerating its crypto industry crackdown. Regulators across multiple departments are banding together to reign in crypto projects and companies.
This coordinated ongoing assault is being referred to as ‘Operation Choke Point 2.0,’ a term coined by Castle Island Ventures’ partner Ниц Цартер.
For those unfamiliar, the original operation ‘Choke Point’ was a coordinated crackdown on companies considered high-risk by U.S. regulators. Their primary tactic was to pressure the banking sector to stop doing business with companies in specific industries, even though most were operating within the bounds of the law.
Операција почео in 2013, and many companies related to firearms, drugs, loans, and other risky industries lost access to banking services in the USA. Choke Point was controversial mainly because it was never formally voted on by U.S. politicians and was somewhat of a rogue operation.
Верује се да потицати with the Department of Justice (DOJ), allegedly acting on the orders of then-President Barack Obama.
The Raging War on Crypto
Interestingly, Operation Choke Point was likely to blame for why крипто компаније had difficulty accessing banking services in the early days. This is because the operation was initiated around the same time that crypto saw its first notable wave of growth and adoption in the early to mid-2010s.
Carter explains that the inability of the crypto industry to access onshore banking services quickly led to the rise of offshore alternatives. Most notably, this includes Tether’s USDT стаблецоин.
In a similar vein, a more targeted approach appears to be being carried out today. There is speculation that this second phase, ‘Operation Choke Point 2.0,’ started sometime in early 2022.
One of the earliest examples of this was in early 2022 when JPMorgan suddenly наставу the bank account of Uniswap founder Hayden Adams.
Former Commodity Футурес Trading Commission (CFTC) head Brian Quintenz responded with a коментар. He suggested that this was likely ‘shadow de-banking of crypto by the Federal Reserves and OCC bank examiners.’
FTX Collapse Lit a Fire Under Regulators
This begs the question of who gave the go-ahead for this crackdown. Carter feels that јое Biden’s Administration and the Democratic Party were the ones to set this plan in motion. Some question that if Choke Point 2.0 began in 2022, why has it only affected the crypto industry recently? This might be due to anti-crypto politicians being заузет with the 2022 midterm elections.
колапс of Земља and its algorithmic stablecoin, the implosion of Three Arrows Capital, and Celsius’ insolvency all attracted U.S. politicians’ attention. But, the FTX and Alameda co-collapse was the cherry on the торта that regulators needed to turn up the heat.
Unlike the other three crypto fiascos mentioned above, the collapse of FTX and Alameda also утицало Silvergate, a massive U.S. bank. Soon, Signature, another crypto-friendly bank, најавила it would cut deposits from crypto customers, forcing them to withdraw their money or potentially have their accounts closed.
New Troubles in the New Year
Jan. 3 seems to have been the official start of the operation’s second iteration. On this day, the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) угасити a joint statement. suggesting that banks stop holding crypto and shy away from the sector.
In January, the Fed introduced a policy that would make it harder for crypto banks to get off the ground. On the same day, the Biden Administration published a cryptocurrency roadmap, which recommended that pension funds stay away from crypto.
The visible crackdowns on crypto-friendly banking firms directed affected the crypto industry. Бинанце, the largest exchange, суспендован USD bank transfers to and from its exchange. This came just weeks after Binance announced that its banking partner (Signature) wouldn’t accept transfers to and from the exchange of less than $100,000.
Source: https://beincrypto.com/operation-choke-point-2-federal-governments-ploy-snuff-crypto/