Coinbase is accusing the Federal Deposit Insurance Corporation (FDIC) of blocking efforts to uncover information about alleged attempts to stifle the cryptocurrency industry. This alleged campaign, dubbed “Operation Choke Point 2.0,” is said to involve government regulators trying to shut down crypto businesses.
The Fight for Information
Coinbase is using the Freedom of Information Act (FOIA) to get documents showing the FDIC pressured banks to cut ties with crypto companies. These actions, known as “pause letters,” are the focus of Coinbase’s investigation. However, the FDIC’s response hasn’t been cooperative, according to Coinbase Chief Legal Officer Paul Grewal.
The company hired the law firm History Associates to help. They filed a motion in court to force the FDIC to comply. Grewal points out that the FDIC claimed to have conducted “due diligence” to ensure no documents were destroyed, but refused to explain what that due diligence entailed. He also criticized the FDIC’s release of heavily redacted documents as insufficient. The FDIC’s response to requests for information about its FOIA policies has also been deemed inadequate.
Congress Steps In
Last month, the FDIC released some redacted documents related to its oversight of crypto activities, including pause letters sent to 24 banks. However, House Oversight Committee Chairman James Comer requested unredacted copies of these documents from FDIC Acting Chairman Travis Hill.
What’s the FDIC Hiding?
Coinbase believes the FDIC’s resistance to transparency suggests they are hiding something. The ongoing legal battle highlights the tension between regulators and the cryptocurrency industry, and the struggle for transparency in government actions.
