Coinbase Calls For An End To Crypto Banking Restrictions

The standoff between the crypto industry and U.S. banking regulators is taking a decisive turn. For several years, companies in the sector have denounced restrictions that limit their access to traditional banking services. This phenomenon of “debanking,” seen as an unjustified hindrance, hinders their development and fuels a climate of uncertainty. In the face of this situation, Coinbase is stepping up. In a letter addressed to the Federal Reserve (Fed), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC), the platform is calling for the removal of obstacles that prevent banks from collaborating with crypto actors. Coinbase is demanding the cancellation of a directive from the OCC, as the platform believes it imposes an excessive approval process for new banking activities related to cryptos. The company considers this approach contrary to the law and urges regulators to officially recognize the right of banks to offer custody and execution services for cryptos. This offensive comes as the debate takes on a political dimension. Under pressure from Republican lawmakers, Congress is organizing two key hearings this week, in the Senate and the House of Representatives, to examine these controversial practices. The outcome of these discussions could redefine the regulatory framework for the crypto industry in the United States.

Coinbase’s Claims : Towards the End of Crypto “Debanking” ?

Coinbase is directly confronting U.S. banking regulators and demanding clarifications on the rules governing financial services related to cryptos. In a letter addressed to the Federal Reserve (Fed), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC), the exchange calls for the repeal of a directive deemed too restrictive. According to the platform, an interpretative letter from the OCC introduces an implicit approval process for new banking activities related to cryptos, without going through a formal regulatory procedure. Coinbase believes this approach violates the Administrative Procedure Act, a federal law that guarantees the transparency and legitimacy of rules adopted by government agencies.

In addition to this request, Coinbase urges the Fed and the FDIC to officially confirm that state-chartered banks under their supervision have the right to offer custody and execution services for cryptos. For the company, these restrictions hinder the development of the sector, but also create a competitive imbalance and prevent access to traditional financial infrastructures. Faryar Shirzad, Coinbase’s chief public affairs officer, denounced this situation in a message posted on X (formerly Twitter) on February 4, 2025: “For several years, U.S. banking regulators have unilaterally and without democratic justification prevented banks from offering crypto services. This must stop.”

Coinbase’s move comes as frustration grows among industry companies struggling to obtain or maintain bank accounts in the United States. This phenomenon of “debanking,” often attributed to vague directives and excessive enforcement of prudential rules, fuels a climate of uncertainty that weighs on innovation and the competitiveness of crypto companies on American soil.

A Growing Political Battle : Stakes and Uncertainties

In Washington, the issue of “debanking” of crypto companies has emerged as a major controversy. The pressure from several Republican lawmakers is intensifying, as they accuse regulators of attempting to quietly oust the crypto industry from the traditional banking system. In response to these concerns, Congress has scheduled two hearings this week, one before the Senate Banking Committee and the other before the House Financial Services Committee. During these sessions, Paul Grewal, Coinbase’s general counsel, will present the company’s position and defend the right of crypto actors to access banking services.

Beyond the political stakes, the economic dimension of this affair raises concerns. Large American banks, subject to strict anti-money laundering rules, are still hesitant to collaborate with the crypto industry. This climate of uncertainty is exacerbated by the vagueness surrounding the directions of the new Trump administration. Travis Hill, recently appointed acting chairman of the FDIC, has acknowledged the need to clarify the regulatory framework but has not announced concrete measures to relax existing restrictions.

The outcome of these debates could reshape the banking landscape for the crypto industry in the United States. If political pressures lead to a relaxation of restrictions, crypto companies could finally gain access to stable and secure banking services. Conversely, if regulators maintain their cautious approach, or even tighten it, the gradual exclusion of the crypto sector from the traditional financial system could continue. In this context, the coming months will be decisive for the future of relations between banks and the crypto ecosystem.