U.S. to Penalize Banks for Politically Motivated Account Closures

The U.S. administration is preparing to issue an executive order aimed at addressing allegations of politically motivated account closures and discriminatory banking practices, particularly affecting cryptocurrency firms [1]. The directive, expected to be released in early August 2025, would task federal regulators with investigating claims of “debanking” and potentially enforcing penalties on institutions that restrict access to financial services based on political or industry-related factors [2]. The move has been labeled as a potential “Operation Choke Point 2.0,” referencing earlier regulatory efforts that critics say were used to target certain sectors, including crypto firms [3].

The executive order will require bank regulators to assess whether financial institutions have violated antitrust, consumer protection, or fair lending laws in their treatment of digital asset businesses. The Small Business Administration will also be involved, tasked with reviewing loan guarantee practices and ensuring that they do not disproportionately impact crypto-related companies or politically conservative clients [1]. The Department of Justice may be called upon to investigate and pursue legal action in cases of potential violations [2].

The Federal Reserve and other regulatory bodies have recently adjusted their oversight approaches, including ceasing reputational risk examinations for banks, a policy shift seen as reducing regulatory pressure that had previously contributed to account closures [3]. This change aligns with broader efforts to encourage more inclusive banking practices and to ensure that financial institutions do not engage in politically motivated “derisking” [1].

Industry leaders have responded positively to the potential directive. Changpeng Zhao, CEO of Binance, has previously expressed support for measures that promote fair access to banking services for crypto businesses, calling the executive order a “new era for crypto banking” [4]. However, the ultimate impact of the directive will depend on how regulatory agencies interpret and enforce its provisions, as well as the broader political environment [1].

This initiative reflects ongoing tensions between the traditional banking sector and the crypto industry. Critics argue that crypto-related account closures are often driven by reputational concerns and regulatory uncertainty, while supporters maintain that the practice is a legitimate risk management tool [1]. The administration’s focus on debanking suggests a growing recognition of the need for regulatory clarity and equitable treatment for digital asset firms.

As the details of the executive order continue to emerge, market participants are closely watching for signs of how it might shape the future of crypto banking and federal oversight. The directive could signal a significant shift in the approach to digital asset regulation and banking compliance [1].

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[1] AInvest – U.S. to Penalize Banks for Politically Motivated Account Closures – [https://www.ainvest.com/news/penalize-banks-politically-motivated-account-closures-2508/](https://www.ainvest.com/news/penalize-banks-politically-motivated-account-closures-2508/)

[2] SSBCrack – Trump Set to Sign Executive Order Investigating Banking Practices Amid Crypto Debanking Claims – [https://news.ssbcrack.com/trump-set-to-sign-executive-order-investigating-banking-practices-amid-crypto-debanking-claims/](https://news.ssbcrack.com/trump-set-to-sign-executive-order-investigating-banking-practices-amid-crypto-debanking-claims/)

[3] Decrypt – Trump to Issue Executive Order Shielding Crypto Firms – [https://decrypt.co/333524/trump-executive-order-crypto-firms-debanking](https://decrypt.co/333524/trump-executive-order-crypto-firms-debanking)

[4] BeInCrypto – Changpeng Zhao (CZ) Hails New Era for Crypto Banking – [https://beincrypto.com/binance-cz-us-banks-crypto/](https://beincrypto.com/binance-cz-us-banks-crypto/)