Trump Set to End Crypto Banking Ban with New Executive Order

Highlights:

• Donald Trump will likely sign a new Executive Order to eliminate crypto banking restrictions.
• Sources familiar with the story claimed the order would include provisions for Stablecoin legislation.
• There could be possible changes to the Federal Reserve policies with the new order.

US President Donald Trump plans to sign a new Executive Order to remove the restrictions that have made it difficult for crypto firms to access banking services. Sources familiar with the story noted that the new order aims to roll back every restriction associated with Operation Chokepoint 2.0. It could also include provisions to free stablecoins from securities classification.

Critics described Operation Chokepoint 2.0 as an alleged plot by the Joe Biden administration to prevent crypto firms from accessing banking services. During the White House Summit on March 7, Trump announced plans to discontinue the operation. He discussed it alongside the need to pass stablecoin legislation with clear rules.

Bo Hines, the White House’s Presidential Working Group on Digital Assets Executive Director, confirmed the news. While he did not elaborate on the order, he stated that it should be expected soon.

New Executive Order Could Influence Federal Reserve Policies

In a March 10 tweet, Fox Business journalist Eleanor Terrett also confirmed the US president would sign a new order. She noted that the order will scrap some Federal Referral Policies, preventing crypto banks from accessing master accounts.

Terrett added that if signed, the order would be a game-changer for Custodia Bank. She noted that Caitlin Long, the founder and Chief Executive Officer of the Custodia Bank, has been engaging the Federal Reserve in court over the master account issue.

In a follow-up tweet, Terrett stated that the Federal Reserve Chairman, Jerome Powell, raised concerns about the growing number of crypto debanking cases last month and assured that the Fed would investigate the cases. However, according to Terrett, neither the Federal Reserve nor the Federal Deposit Insurance Corporation (FDIC) has rolled back these rules despite Powell’s comment.

OCC Permits Crypto Banking

On March 7, the Office of the Comptroller of the Currency (OCC) published an Interpretive Letter 1183. The publication clarified that national banks and federal savings associations can now offer crypto custody and stablecoin services without prior regulatory approval.

The OCC also permits banks to participate in some Decentralized Finance (DeFi) activities like validating blockchain transactions. The agency mandates that these activities must align with existing bank rules. Acting Comptroller of the Currency Rodney E. Hood said the OCC decision will ease the burden on banks engaging in crypto activities.

Caitlin Long was quick to react to the OCC’s announcement. She praised the office for allowing banking firms to participate in crypto. She also criticized the FDIC and Fed, claiming they are detrimental to crypto.

Trump Remains Focus on Crypto Policy Reforms

Since taking office, Trump has delivered on campaign promises with several pro-crypto initiatives. If he signs a new order enabling banking firms to access crypto services, it will become the president’s third Executive Order in less than three months.

In January, Trump’s first order of his second tenure created the Presidential Working Group on Digital Asset Markets. Last week, He signed the second order to establish a Strategic Bitcoin Reserve and a separate Crypto Stockpile.