Key Takeaways
- Coinbase is urging US banking regulators to enable banks to offer crypto custody and trading services.
- Coinbase seeks confirmation that state-chartered banks can provide and outsource crypto services under current laws.
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Coinbase is calling on US banking regulators to revise their stance on crypto services, pushing for changes that would allow banks to provide crypto custody, trading services, and partnerships with digital asset companies, Bloomberg reported Tuesday.
The crypto exchange recently sent a letter to the Office of the Comptroller of the Currency (OCC), Federal Reserve Board of Governors and Federal Deposit Insurance Corp (FDIC), requesting the OCC withdraw an interpretive letter that Coinbase claims creates a de facto application process preventing banks from entering the digital asset market.
The company is seeking formal confirmation from the Fed and FDIC that state-chartered banks under their supervision can provide and outsource crypto custody and trading execution services.
“It’s important for regulators to make clear that banks can work with third-party providers in providing trading and exchange services to their customers,” said Faryar Shirzad, chief policy officer at Coinbase, in a statement.
Coinbase, backed by three law firms, contends that current laws and regulations already permit banks to engage in crypto services and work with third-party providers. The company is requesting regulators to formally acknowledge this existing legal framework.
The push comes as the House Oversight Committee investigates Operation Choke Point 2.0, examining alleged regulatory actions limiting banking access for crypto firms. The FDIC and other regulatory bodies have reportedly applied informal pressure on banks to limit services to industries considered risky, including digital assets.
Coinbase uncovered multiple instances where the FDIC discouraged banks from providing crypto banking services, including internal documents that showed the agency asked banks to “pause” crypto-related activity.
Coinbase’s legal chief Paul Grewal and CEO of MARA Holdings Fred Thiel are scheduled to testify before the Subcommittee on Oversight and Investigations of the US House Financial Services Committee on Thursday regarding the alleged systematic debanking of crypto firms under the Biden administration.
I’m testifying at the @FinancialCmte’s oversight hearing looking into the past clandestine and undemocratic campaign to cut off crypto from banking. On behalf of @Coinbase, I’m proud to help shed light on the unfair treatment of our industry and thank @FinancialCmte and… pic.twitter.com/TDIVu1cdW1
— paulgrewal.eth (@iampaulgrewal) February 3, 2025
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