Coinbase Urges U.S. Agencies for Crypto Banking Clarity

Coinbase, a leading cryptocurrency exchange, has sent a letter to key U.S. regulatory agencies, requesting the issuance of a Cryptocurrency Industry Banking Clarity Report. The letter, addressed to the Office of the Comptroller of the Currency (OCC), the Federal Reserve Board, and the Federal Deposit Insurance Corporation (FDIC), seeks clarity on the banking status for the crypto industry.

Serving the crypto industry has long been a contentious issue for U.S. banks. While federal law already authorizes banks to provide crypto services and partner with third-party providers like Coinbase, some banks have been hesitant to engage in the sector due to regulatory uncertainty. In June 2024, Coinbase filed a lawsuit against the U.S. Securities and Exchange Commission (SEC) and the FDIC, accusing these agencies of attempting to "quarantine crypto asset companies from basic banking services."

With the incoming Trump administration, the crypto community is hopeful for positive changes in the U.S. crypto ecosystem. Coinbase, as the largest custodian of a U.S. Bitcoin spot ETF, has been deepening its ties with the Trump administration. Faryar Shirzad, Coinbase's Chief Policy Officer, stated that regulators must clearly state that banks can collaborate with third-party providers to offer crypto transaction services to customers.

Coinbase's latest move comes as the House Oversight Committee investigates Operation Choke Point 2.0, examining alleged regulatory actions limiting banking access for crypto firms. The FDIC and other regulatory bodies have reportedly applied informal pressure on banks to limit services to industries considered risky, including digital assets. Coinbase has uncovered multiple instances where the FDIC discouraged banks from providing crypto banking services, including internal documents that showed the agency asked banks to "pause" crypto-related activity.

Coinbase's legal chief Paul Grewal and CEO of MARA Holdings Fred Thiel are scheduled to testify before the Subcommittee on Oversight and Investigations of the US House Financial Services Committee on Thursday regarding the alleged systematic debanking of crypto firms under the Biden administration.