A group of Republican senators led by Bill Hagerty of Tennessee wrote a letter to banking regulators on March 9 supporting this interpretation. The statements released by regulators “have forced banks to reconsider their decision to provide banking services to the crypto sector,” the letter states. “This coordinated behavior appears to be disturbingly reminiscent of Operation Choke Point.”

“Operation Choke Point 2.0 is very real,” says Caitlin Long, CEO of Custodia, the defunct bank. “Many banks have stepped back in their crypto activities… and a lot [crypto] companies from small to very large are looking for bank accounts.’

Since January, Custodia has been inundated with inquiries from crypto companies looking for a banking partner, Long says, but without federal oversight, it can only offer a limited selection of US dollar services. Custodian sues Fed over denial of application to join.

Others are less convinced of the Choke Point theory. Economist Frances Coppola, who has worked in risk management at HSBC and the Royal Bank of Scotland, says she does not believe there has been a “coordinated attack on cryptography” but that the failure of Silvergate and Signature is a reflection of the fragility in their operating models. Caleb Franzen, corporate banking analyst at research firm Cubic Analytics, says talk of underhanded tactics by regulators is “pure speculation.”

But by accident or by design, crypto faced the banking crisis in the US.

The closure of Silvergate and Signature forced the crypto business to urgently look for new banking partners. Circle Internet Financial, whose USDC stablecoin was temporarily delinked from the dollar amid revelations of exposure to Silvergate and SVB, agreed over the weekend to expand its existing relationship with BNY Mellon. But not everyone is home and dry; Crypto investment companies MaiCapital and Digital Asset Capital Management have been looking for new banking partners offshore, while trading platform LedgerX has been forced to find a new bank for the second time after its initial switch from Silvergate to Signature. Neither firm responded to a request for comment.

Because of the value they represent to banks, larger crypto businesses will likely be able to keep their existing US accounts, Carter says, meaning US residents will still have access to crypto exchanges. But smaller firms are “killing themselves,” he says. As a result, some businesses are likely to migrate to countries with more favorable regulatory regimes; some will struggle to attract venture capital that depends on access to banking services; and others won’t be started in the first place, Carter says.

With the downfall of Silvergate and Signature, the only two banks offering real-time payments at any hour, any day, the 24/7 crypto industry will have to adjust to a different pace. For traders, this means not being able to place bets outside of normal banking hours, which is likely to create an additional level of volatility.

Swan Bitcoin’s Klippsten doesn’t buy into the idea that US regulators have launched a coordinated attack on the crypto industry, led by “a man behind the curtain pulling the strings.” He is also more bullish on the prospects of the Silvergate and Signature orphans finding new banking partners, saying “banks are usually happy to take your money”.

Klippsten is also sympathetic to regulators’ ambitions to protect against fraud in the crypto sector. But the frustration, he said, is that legitimate crypto companies will be collateral damage.

“Because crypto is so boring and some of the businesses are so poorly run, the whole category is toxic—on average, it’s a bunch of shit,” he says. “So it’s hard to ask a bank with hundreds of thousands of accounts to distinguish between a good crypto business run by adults, [and bad ones]. We got stuck when we were painting with one brush.”

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