Coinbase CEO Brian Armstrong and technology billionaire Elon Musk have accused prominent political figures, including Senator Elizabeth Warren and SEC Chair Gary Gensler, of orchestrating a “mass debanking” campaign targeting the technology and cryptocurrency sectors during the Biden administration.
Their remarks follow revelations about secretive actions that allegedly resulted in the closure of bank accounts for dozens of tech entrepreneurs without notice or recourse.
Crypto Leaders Strong Rebuke of the Biden Administration
In a post on X (formerly Twitter), Armstrong labeled the debanking incidents as “unethical and un-American.” He pointed fingers at Warren and Gensler, accusing them of attempting to “unlawfully kill” the cryptocurrency industry.
Brian Armstrong argued that such actions contributed to the Democratic Party’s loss in the recent election. The Coinbase executive cautions the party to distance itself from Warren if it seeks political recovery.
He also revealed that Coinbase is using Freedom of Information Act (FOIA) requests to uncover the full scope of the issue, raising questions about potential legal violations.
“We’re still collecting documents via FOIA requests, so hopefully the full story emerges of who was involved and whether they broke any laws. Warren and Gensler tried to unlawfully kill our entire industry, and it was a major factor in the Dems losing the election,” Armstrong stated.
Armstrong’s remarks amplified a controversy shared by Elon Musk, who was known for his advocacy of free speech and innovation. The SpaceX CEO referenced a Joe Rogan interview with Marc Andreessen, co-founder of Andreessen Horowitz.
“Did you know that 30 tech founders were secretly debanked?” Musk remarked.
In the interview, Andreessen alleged that 30 tech founders were “secretly debanked,” describing it as an exercise of “silent government power.” This raises attention to the lack of transparency and warns of broader implications for freedom and innovation.
Custodia Bank’s Caitlin Long Joins the Criticism
Caitlin Long, founder and CEO of Custodia Bank, also weighed in, sharing her personal experience with repeated debanking. Custodia, a pro-crypto bank, has faced regulatory hurdles, culminating in layoffs attributed to the Federal Reserve’s delays in granting the institution a master account. Long’s ongoing lawsuit against the Fed seeks to address these challenges, with oral arguments scheduled for January 21, 2025.
“Yes—debanked repeatedly, in my company’s case (Custodia Bank). Keep an eye on our pending lawsuit against the Fed. Oral argument is scheduled for Jan 21 (the day after Inauguration Day),” Long commented.
The allegations come amid broader concerns over regulatory overreach in the crypto space. Warren and Gensler have been vocal critics of the industry, and the SEC, under Gensler’s leadership, has pursued multiple enforcement actions against crypto firms. Critics argue these measures stifle innovation and disproportionately target emerging technologies.
Custodia Bank’s struggles, among others like Consensys, reflect the challenges facing crypto-friendly financial institutions. The fallout from these allegations could reshape the relationship between the tech sector and US policymakers.
Brian Armstrong’s assertion that these actions contributed to the Democrats’ electoral losses highlights the political risk of alienating the tech and crypto communities. Additionally, Long’s lawsuit could set a precedent for how courts address claims of regulatory overreach.
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