The Blockchain Association is seeking information from the Fed, FDIC and OCC about “de-banking” crypto firms

The Blockchain Association is seeking information from the Fed, FDIC and OCC about “de-banking” crypto firms

The US-based crypto advocacy group Blockchain Association asked financial regulators to provide information related to the potential “de-banking of crypto firms” in the wake of the failures of banks including Signature, Silicon Valley Bank and Silvergate.

In a March 16 notice, the Blockchain Association said it had sent Freedom of Information Act requests to the Federal Deposit Insurance Corporation, the Board of the Federal Reserve System and the Office of the Comptroller of the Currency for documents and communications that could potentially show regulators’ actions as “improper vis contributed” to the collapse of the three banks. According to Blockchain Association CEO Kristin Smith, crypto firms “should be treated like any other law-abiding business” in the United States with access to bank accounts.

“BA is investigating disturbing allegations – including account closures and refusals to open new accounts – which have become more concerning in the wake of this week’s banking crisis,” so Association. “A crisis that long-term crypto opponents have rushed to blame, wrongly, on the technology.”

For many in the space, the recent banking crisis began with Silvergate’s parent company announcing on March 8 that it would “discontinue operations” for the crypto bank. Silicon Valley Bank followed on March 10 with its own failure after a run on deposits, and the Treasury Department, the Fed and the FDIC announced the closure of Signature Bank on March 12.

At the time, a joint statement from the regulators said the action against Signature was taken to “protect the US economy by strengthening public confidence in our banking system”. However, former US Representative and signature board member Barney Frank argued that the FDIC sent a “strong anti-crypto message” by closing the bank, and some lawmakers are demanding answers.

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An FDIC spokesperson told Cointelegraph that the bidding process for banks interested in buying Signature and Silicon Valley Bank had begun. They suggested that recent reports that the FDIC solicited potential buyers of the failed banks that do not support any crypto services could have been part of its “confidential marketing process”.

“A receiver tells the FDIC what assets and liabilities of the failed bank it is willing to take, as well as what (if any) money will change hands,” according to the FDIC’s resolution manual.

Related: US Crypto Regulation Happens ‘Behind Closed Doors’ — Blockchain Association CEO

Before it was shut down, Signature was considered by many to be a major crypto-friendly bank in the US, providing services to Coinbase, Paxos Trust, BitGo and Celsius. Some in the space have suggested that federal regulators’ perceived crackdown on banks servicing crypto firms could force companies to turn to “shadier” options.

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