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A new report from Republican members of the U.S. House Financial Services Committee is stirring fresh debate in Washington. The document outlines claims that federal regulators under the Biden Administration tried to limit crypto activity inside the traditional banking system.
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Committee staff argue that several agencies acted in ways that discouraged banks from working with crypto companies. They describe the pattern as an effort by federal officials to pressure financial institutions into distancing themselves from digital asset businesses.
The report also highlights an unusual timing issue: while regulators were allegedly tightening restrictions, lawmakers were trying to build a federal framework for digital assets. Republicans say the actions undercut those attempts.
Four major regulators are central to the allegations: the Federal Reserve, the FDIC, the Office of the Comptroller of the Currency, and the SEC.
The report claims the Federal Reserve applied pressure through statements, supervision, and regulation letters. It also cites the Fed’s Novel Activities Supervision Program, which placed additional oversight on institutions involved in digital asset activities.
According to the document, the FDIC sent “pause” letters to banks, which effectively urged institutions to halt or rethink digital asset initiatives. Staff argue that these delays, paired with extensive requests for documents, made it nearly impossible for banks to move forward.
The report also states that the OCC required banks to obtain non-objection letters before exploring digital asset services.
The SEC is cited for its long list of enforcement actions targeting crypto companies, which Republican staff say added to the industry’s pressure environment.
Republicans and several digital asset advocates call the alleged approach “Operation Choke Point 2.0,” comparing it to an earlier controversy where regulators were accused of quietly pressuring banks to drop certain industries.
Committee staff argue that crypto firms experienced a similar dynamic over the last few years, leaving many without access to basic financial services.
It claims they discouraged banks from offering services to crypto firms through supervision, letters, and added oversight.
The Federal Reserve, FDIC, OCC, and SEC appear extensively in the report.
They believe the pattern resembles the earlier federal practice of nudging banks away from controversial industries.
Republican staff say further oversight of regulators is needed, but the document focuses mainly on documenting alleged actions.