David Sacks, appointed as Donald Trump’s cryptocurrency advisor, set to address Operation Choke Point 2.0
Donald Trump vowed to end Operation Choke Point 2.0 if he is re-elected. David Sacks, who serves as the “crypto czar” in Trump’s pro-crypto initiative, is central to this effort.
In a recent post on Twitter, Sacks promised to investigate and reverse policies that are seen as undermining the cryptocurrency sector, aligning with Trump’s commitment to fair banking practices for digital asset companies.
David Sacks to Tackle Targeted Suppression against Banks
Operation Choke Point 2.0 is a US government strategy to restrict cryptocurrency activities by using banking regulations. In 2022, the Federal Deposit Insurance Corporation (FDIC) allegedly pressured financial institutions to limit services to crypto firms, a matter that Sacks believes needs to be addressed.
“There are too many stories of people being hurt by Operation Choke Point 2.0. It needs to be looked at,” he said.
Coinbase recently released letters confirming the FDIC’s instructions to banks to pause or stop crypto-related banking activities. Coinbase’s Chief Legal Officer, Paul Grewal, described this as evidence that it was not just a conspiracy theory and committed to pursuing transparency through legal means.
“Law-abiding American businesses should be able to access banking services without government interference,” Grewal emphasized.
One of the casualties of these policies was Silvergate Bank, once a key player in crypto banking. A former executive at Silvergate, Chris Lane, described how the bank faced regulatory scrutiny despite its financial stability. Lane accused regulators of abruptly withdrawing support, leading to the downfall of the business his team had built over 13 years.
“When FTX went down, Silvergate survived a 70% run on deposits. A typical bank cannot survive 20%. FTX didn’t kill us, our regulators did…Regulators came in sometime in Spring 2023 and severely limited the amount of US dollar deposits we could hold for digital asset clients There went our entire business model,” Lane stated.
The demise of the bank was attributed to targeted restrictions on serving cryptocurrency clients. David Sacks, Trump’s crypto Czar, has called for a thorough investigation into Operation Choke Point 2.0.
Experts Join Trump’s Crypto-Friendly Vision
Sacks, along with others like Charles Hoskinson, founder of Cardano, seeks unity in the crypto industry against regulatory overreach. Hoskinson plans to work with the incoming Trump administration on bipartisan policies balancing innovation and accountability.
Bitcoin investor Wayne Vaughn echoes Hoskinson’s sentiment, criticizing the politicization of the banking system.
“The US government shouldn’t weaponize the banking system against its political opponents and people that are deemed otherwise undesirable,” Vaughn asserted.
Trump’s approach of appointing pro-crypto individuals for his administration aims to dismantle establishments like Brian Deese, the alleged architect of Operation Choke Point 2.0.
By appointing pro-crypto advocates to his transition team, Trump aims to create a regulatory environment favorable to digital innovation.
Crypto experts see the 2024 election as crucial for the industry. Trump’s promises and Sacks’ leadership could reshape the regulatory landscape for digital assets in the US.
“The incoming administration has the opportunity to reverse so many poor crypto policy decisions. Chief among them is politically motivated regulatory decisions like Operation Choke Point 2.0,” Grewal said.
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