JPMorgan suspends Gemini accounts over data access fees dispute

JPMorgan Chase & Co. has suspended new account onboarding for Gemini Trust Co., a cryptocurrency custodian and exchange, following a public dispute over data access fees. The decision, reported by multiple outlets, comes after Tyler Winklevoss, co-founder of Gemini, criticized the bank’s new policy requiring fintech firms to pay for access to customer banking data. Winklevoss alleged JPMorgan retaliated against Gemini for voicing concerns about the fees, which he claimed would “bankrupt fintechs” and hinder consumer access to crypto services [1]. The bank reportedly paused the re-onboarding process after Winklevoss publicly opposed the charges, which were previously highlighted in Bloomberg reports [1].

The dispute centers on JPMorgan’s plan to charge data aggregators—such as Plaid—that facilitate crypto platforms’ access to bank accounts. Industry leaders, including trade associations like the Blockchain Association, have labeled the fees a “punitive tax” and urged regulatory intervention. The move aligns with broader efforts by traditional banks to mitigate risks in the crypto sector, including the Trump-era Consumer Financial Protection Bureau’s (CFPB) ongoing legal challenge to its Section 1033 rule, which mandates free data sharing [1]. JPMorgan’s stance reflects a risk-averse strategy amid regulatory uncertainties, with CEO Jamie Dimon framing the fees as necessary for security and cost predictability [1].

The incident highlights escalating tensions between legacy financial institutions and crypto-native firms. Gemini, which relies on partnerships with traditional banks for institutional services, faces challenges in balancing profitability with compliance costs. The temporary account suspension could signal a shift toward in-house solutions by banks, reducing their exposure to crypto’s volatility and regulatory scrutiny [1]. Analysts note that if data fees become industry-wide, operational costs for fintechs may rise sharply, potentially stifling innovation and liquidity on major exchanges [1].

The broader implications for the crypto ecosystem are significant. Past regulatory campaigns, such as Operation ChokePoint 2.0, have already restricted crypto firms’ access to banking services, leading to the shutdown of major crypto banks like Silvergate and Signature. The concentration of services under a few remaining providers, such as Cross River Bank, creates systemic risks for the digital asset market [1]. JPMorgan’s move may accelerate the adoption of decentralized finance (DeFi) solutions, bypassing traditional banking gatekeepers.

For investors, the dispute underscores interdependencies between traditional finance and crypto infrastructure. While JPMorgan’s actions are unlikely to disrupt its core operations, they could delay Gemini’s institutional expansion plans. The resolution of this fee dispute may set a precedent for future negotiations, influencing how data access is priced and governed across financial institutions [1].

Sources:

[1] [Navigating the Volatile Crossroads: Investment Risks and Opportunities] [https://www.ainvest.com/news/jpmorgan-suspends-gemini-accounts-data-fee-dispute-2507/]

[2] [Tyler Winklevoss claims JPMorgan blocked Gemini after criticism] [https://cointelegraph.com/news/tyler-winklevoss-says-jpmorgan-blocked-gemini-after-criticism]

[3] [JPMorgan Halts Gemini Onboarding Amid Open Banking Dispute] [https://www.ainvest.com/news/jpmorgan-halts-gemini-onboarding-open-banking-dispute-winklevoss-2507/]