The US Central Bank Forces Cryptocurrency Custodia Bank to Lay off 36

Custodia Bank, a financial firm in Wyoming that focuses on cryptocurrency services, had to let 36 employees go after a continuing court battle with the US central bank.

The current government administration has pursued what many are calling Operation Chokepoint 2.0. The popular term applies to strategies from the Biden administration to keep crypto separated and removed from the rest of the financial sector. The term comes from the plan known as Operation Choke Point that President Obama initiated during his term where he limited the power of firearms vendors, gambling operators, and payday loan lenders and kept them segregated from much of the financial sector.

Management at Custodia Banks say that the government is actively working against them to hinder their ability to operate freely and to use cryptocurrency in their daily activities. They say the legal battle they are facing in court as well as restrictive actions from the government has forced them to let go 36 of their employees as they try to keep their business afloat.

The bank is fighting the Federal Reserve right now over the ability to use a master account, which would help them use federal payment services. They have been blocked from doing so, and that forces them to pay high fees by using other institutions who offer master account access.

Cryptocurrency and the Government

This election cycle has been partly about cryptocurrency, its access and who will support it once they are elected. Many crypto industry insiders are pointing out which candidates have voiced their support for crypto, even down to VP picks, and potential cabinet members.

That is important since whoever is elected president may not think that cryptocurrency regulations are very vital to their platform once they are in office. They may focus on other issues and leave the topic of crypto to their cabinet members of vice president.

The Trump campaign his pushed crypto as a big part of their platform and also attacked the restrictive performance of the current administration on that issue. News stories like the Custodia Bank losing employees over crypto laws brings attention to the serious real-world effect of limiting cryptocurrency laws and how the current administration has a poor track record with this industry. The question voters are asking now is whether the Democratic Party will continue to be dismissive and restrictive when it come sot crypto oversight and regulation or whether their stance will change as this election cycle progresses.