U. S. Accuses FDIC of Destroying Cryptography
2023.03.15 19:50
U. S. Accuses FDIC of Destroying Cryptography
By Ray Johnson
Budrigannews.com – The majority whip of the United States House of Representatives, Tom Emmer, has reiterated his concern that the federal government is “weaponizing” concerns about the banking industry in order to pursue cryptocurrency.
Emmer wrote to Martin Gruenberg, chair of the Federal Deposit Insurance Corporation, on March 15 to find out if the government agency has specifically instructed banks not to provide services to crypto firms or suggested that doing so might be an “onerous” task. The Minnesota representative cited claims made by Barney Frank, a member of the Signature Bank board and former U.S. Representative, who reportedly referred to the FDIC’s move against Signature as a “strong anti-crypto message” rather than being motivated by worries about the bank’s solvency.
According to Emmer, “these actions to weaponize recent instability in the banking sector, which was catalyzed by catastrophic government spending and unprecedented interest rate hikes are deeply inappropriate and could lead to broader financial instability.”
I wrote a letter to FDIC Chairman Gruenberg today about reports that the FDIC is using recent instability in the banking sector as a weapon to get rid of legal crypto activity in the United States.
Emmer also took aim at Joe Biden’s administration, claiming that policymakers were trying to “choke off digital assets” from the financial system in the United States. The representative from Minnesota also speculated that the United States government could “easily weaponize” a central bank digital currency as a surveillance tool prior to the collapse of Silicon Valley Bank and Signature Bank.
For many in the industry, Silvergate’s parent company’s announcement on March 8 that it would “wind down operations” for the crypto bank marked the beginning of the current banking crisis. After a run on deposits, Silicon Valley Bank followed suit on March 10 with its own failure. The stablecoin USD Coin (USDC) temporarily depegged from the dollar after Circle, the issuer of USD Coin, announced that it had $3.3 billion in bank reserves.
Representative Frank stated that “there was no insolvency based on the fundamentals” at the time, supporting the idea that the shutdown of Signature Bank may have been a deliberate move by government officials against crypto. According to reports, on March 14, the New York State Department of Financial Services stated that the bank’s closure had “nothing to do with crypto,” citing the company’s failure to provide the regulator with “reliable and consistent data.”
