US Lawmaker Accuses FDIC of Using Banking Instability to Attack Crypto

[ad_1]

Tom Emmer, the U.S. House of Representatives Majority Whip, reiterated his concerns that the feds are weaponizing concerns around the banking sector to tackle crypto.

In a March 15 letter, Emmer asked Federal Deposit Insurance Corporation Chairman Martin Gruenberg to respond to questions about whether the state-owned company had specifically instructed banks not to provide services to crypto businesses, or had suggested it might be an onerous task. The Minnesota representative cited claims by Signature Bank board member and former U.S. Representative Barney Frank, who allegedly called the FDIC’s decision against Signature a strong anti-crypto message rather than being based on concerns about bank solvency.

These actions to weaponize recent instability in the banking sector, catalyzed by catastrophic government spending and unprecedented interest rate hikes, are deeply inappropriate and could lead to broader financial instability, Emmer said.

Today I sent a letter to FDIC Chairman Gruenberg regarding reports that the FDIC is weaponizing recent instability in the banking industry to purge legal crypto activity from the United States pic.twitter.com /fDmaA0XGWv

Tom Emmer (@GOPMajorityWhip) March 15, 2023

Emmer also targeted Joe Biden’s administration, accusing policymakers of trying to stifle digital assets from the US financial system. The Minnesota representative made similar statements before the collapse of Silicon Valley Bank and Signature Bank, in addition to speculating that the US government could easily weaponize a central bank digital currency as a surveillance tool.

Related: Signature Bank and former executives sued by shareholders for alleged fraud

For many in the space, the recent banking crisis began with Silvergates’ parent company announcing on March 8 that it would end operations at the crypto bank. Silicon Valley Bank followed on March 10 with its own failure after a run on deposits. USD (USDC) coin issuer Circle declared $3.3 billion of its reserves to the bank, causing the stablecoin to be temporarily separated from the dollar.

Some lawmakers and those in the space have suggested the Signature Bank shutdown may have been a targeted move by government officials against crypto, with Rep. Frank signaling that there is no fundamental-based insolvency at the moment. ‘era. The New York State Department of Financial Services reportedly said on March 14 that the bank’s shutdown had nothing to do with crypto, citing the companies’ failure to provide reliable and consistent data to the regulator.

[ad_2]