President Donald Trump signed an executive order on August 7th, suspending what his administration called discriminatory banking operations against the crypto industry.
The order prohibits federal regulators from using “reputation risks” as justifications that affect banks’ decisions regarding cooperation with legal businesses.
According to the administration, the digital assets sector has been disproportionately affected by behind-the-scenes pressure from regulators, leading to sudden account closures, pay disruptions and loss of financial access for law-abiding businesses.
The move is directly targeting what critics call “Operation Chalk Point 2.0.” This is the term used by the crypto industry to describe a regulated campaign of informal regulatory pressures.
Although not an official program, the term refers to a pattern of supervisory measures that are allegedly discouraged by banks from providing services to digital asset companies, even when banks are complying with existing laws.
Modern chokepoints reflect tactics once used in the Department of Justice initiative in the 2010s. This sought to block bank access in industries labeled as high risk due to fraud, such as firearms and payday lending.
However, unlike its predecessor, the new iteration focuses primarily on cryptography. Since early 2023, several companies have reported unexplained decubitions, following vague concerns about risk, rather than specific violations of compliance.
Industry advocates and pro-crypto lawmakers say the unfriendly environment creates uncertainty for start-ups and institutional players alike, limiting growth and undermining the credibility of US regulators.
Trump’s order codifies recent moves from the Federal Reserve, FDIC and the Secretary of Currency. All of these pledge to suspend bank valuations based on reputation factors.
It also coincides with legislation under debate in Congress, where lawmakers are calling for more stringent restrictions on how lawmakers oversee politically sensitive or emerging industries.
The order is part of a broader effort by the Trump administration to establish clearer protections for crypto companies operating within the US financial system.
