Sen. Cynthia Lummis Accuses FDIC of Crypto Oversight Misconduct, Demands Accountability

Senator Cynthia Lummis (R-WY ) has criticized the Federal Deposit Insurance Corporation ( FDIC ) for its handling of digital asset oversight, alleging misconduct and threatening to sue whistleblowers.

After reporters claimed that the company destroyed documents related to its crypto-related activities and threatened to silence them, Lummis sent a notice to FDIC Chair Marty Gruenberg on Thursday.

” The FDIC’s reported actions are unethical and illegal”, Lummis wrote in her email. The Senator has pledged to investigate the facts behind these allegations and request that accountability be held by governmental agencies involved in the oversight. &nbsp,

” The American people deserve accountability, and I will see to it that they get the replies they deserve”, Lummis wrote in a speech on Thursday.

The FDIC did not immediately respond to request for comment.

The claims center on” Operation Chokepoint 2.0,” a rumored move to undercut crypto companies by restricting their exposure to bank services.

Apparently, reporters informed Lummis that the FDIC supervised staff’s access to sensitive documents to stop Senate leaks.

According to Lummis on X ( previous Twitter ),” The FDIC is attempting to conceal Operation Chokepoint 2.0, and the FDIC must preserve all documents related to digital assets immediately.” Tim Scott and I will get to the middle of it.

Tim Scott was sworn in as Senate Banking Committee seat after his father, anti-crypto lawmaker Sherrod Brown, lost to Bernie Moreno in the 2024 US. votes.

In her email, Lummis has instructed the FDIC to keep all information related to its modern resource activities since January 2022.

The legislator detailed certain types of files to protect, including connections about Signature Bank, Silvergate Bank, and crypto-related police activities. &nbsp,

Lummis likewise demanded that all files be kept in compliance with FDIC recommendations and cooperation with other federal finance organizations regarding digital property.

If the FDIC was found to have “obstructed Senate supervision” and “knowingly destroyed materials,” the politician warned of legal referrals to the DOJ.

Activity Chokepoint 2.0: Allegations of Crypto Industry Targeting

Operation Chokepoint 2.0 resembles an Obama-era initiative that pressed businesses to destroy relationships with these companies and targeted companies like payday loans and gun dealers. &nbsp,

Market advocates claim that this more recent incarnation uses similar tactics to marginalize a whole sector through obtrusive regulatory measures and specifically concentrates on crypto.

Last month, documents obtained via a Freedom of Information Act ( FOIA ) request by Coinbase revealed the FDIC directed banks to “pause all crypto asset-related activity” in 2022.

Crypto industry figures like Coinbase CEO Brian Armstrong and Custodia Bank CEO Caitlin Long have shared personal records of “debanking,” where financial companies were immediately and immediately withdrawn without cause.

Operation Chokepoint 2.0, which was described by pro-crypto lawyer John Deaton earlier this month, was a clear illustration of regulatory overreach motivated by political interests rather than good coverage. &nbsp,

” This isn’t just a fight for crypto”, Deaton warned at the time. It fights against appointed bureaucrats’ unchallenged power and the erosion of organisational integrity.