House Financial Services Committee Hears Testimony on Crypto Debanking Issues

Coinbase's Chief Legal Officer Paul Grewal testified before the House Financial Services Committee about regulatory barriers between banks and crypto firms. Key points from the hearing include:

Grewal criticized "regulation by exhaustion," supported by Republican lawmakers.
Concerns raised about regulators, like the FDIC, directing banks away from crypto while publicly claiming neutrality.
Representative Dan Meuser highlighted potential overreach harming innovation and consumer access to financial products.
Democrats countered that urging caution regarding crypto does not equate to debanking.

A judge in a related case expressed frustration with the FDIC's resistance to disclosing communications about crypto. The FDIC has since released more documents and is reviewing its supervisory communications under new leadership.

Senator Cynthia Lummis revealed an internal Federal Reserve document suggesting efforts to pressure banks against crypto clients, termed "Operation Chokepoint." The House Committee will continue discussions on digital assets in an upcoming hearing.