Blockchain Association calls on FDIC, Fed to provide documents on de-banking crypto firms
|- The Blockchain Association submitted Freedom of Information Act (FOIA) to access documents involving account closures to some crypto firms.
- The Association's CEO, Kristin Smith, demanded equal treatment for crypto and digital asset-related business in the United States.
- This month, the regulators shut down three banks in the US, namely Silvergate, Silicon Valley Bank and Signature Bank.
The crypto industry took an impact following the failure of three banks in the United States. The Blockchain Association is thus taking charge of investigating how the denial of banking services for crypto businesses might have contributed to the banking crisis.
Banks say NO to crypto
The Blockchain Association, a major crypto lobby group based out of the United States, took action against the treatment of the crypto business by the banks. The group submitted Freedom of Information Act (FOIA) requests to the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve and the Office of the Comptroller of the Currency on Wednesday.
The request aims to gain access to documents and communications regarding the "de-banking" of crypto companies in the country. The association described the de-banking as account closures and refusal to open new accounts.
According to the group, this treatment of crypto firms could have contributed to the failure of three US banks in the last week.
The Chief Executive Officer (CEO) of Blockchain Association, Kristin Smith, was noted saying,
The crypto industry is building the next generation of the internet and financial services. This is important work that has created tens of thousands of American jobs. Businesses need bank accounts to pay employees, vendors, and taxes.
The head of the Blockchain Association demanded that cryptocurrency-focused businesses in the United States be treated equally to any other lawful business.
Such an investigation could bring forward the possible negative implications of turning the crypto industry away. Despite being in its infancy, the industry is still worth over $1 trillion and could contribute to the banks' growth.
Banks go down
Over the last few days, three major banks in the country were shuttered by US authorities. Starting with Silvergate Bank, the crisis took down Silicon Valley Bank and added Signature Bank to the list most recently.
However, the New York Department of Financial Services (NYDFS) – the regulatory body responsible for Signature Bank's closing – differed from Blockchain Association's allegations. The NYDFS stated earlier this week that the reason behind the shutdown of the bank had nothing to do with crypto, but it was the failure to provide reliable data that led to the action.
However, more details might emerge over time and upon the conclusion of the Blockchain Association's investigation.
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