Tom Emmer, Majority Whip of the United States House of Representatives, has reiterated concerns that the federal government is \u201cweaponizing\u201d concerns around the banking industry to go after crypto.<\/p>\n
In a March 15 letter, Emmer called on Federal Deposit Insurance Corporation chair Martin Gruenberg to answer questions as to whether the government corporation has specifically instructed banks not to provide services to crypto firms, or suggested doing so may be an \u201conerous\u201d task. The Minnesota Representative cited claims from Signature Bank board member and former U.S. Representative Barney Frank, who reportedly called the FDIC moving against Signature as a \u201cstrong anti-crypto message\u201d rather than based on concerns about the bank\u2019s solvency.<\/p>\n
\u201cThese actions to weaponize recent instability in the banking sector, catalyzed by catastrophic government spending and unprecedented interest rate hikes, are deeply inappropriate and could lead to broader financial instability,\u201d said Emmer. <\/p>\n
Emmer also targeted the Biden administration, accusing policymakers of attempting to \u201cchoke off digital assets\u201d from the U.S. financial system. The Minnesota Representative has made similar claims prior to the collapse of Silicon Valley Bank and Signature Bank, in addition to speculating the U.S. government could \u201ceasily weaponize\u201d a central bank digital currency as a surveillance tool.<\/p>\n
Related: <\/em><\/strong>Signature Bank and former executives sued by shareholders for alleged fraud<\/em><\/strong><\/p>\n For many in the space, the recent banking crisis began with Silvergate\u2019s parent company announcing on March 8 it would \u201cwind down operations\u201d for the crypto bank. Silicon Valley Bank followed on March 10 with its own failure after a run on deposits. USD Coin (USDC) issuer Circle reported $3.3 billion of its reserves in the bank, causing the stablecoin to temporarily depeg from the dollar. <\/p>\n Some lawmakers and those in the space have suggested the shutdown of Signature Bank could have been a targeted move by government officials against crypto, as Barney Frank reported were \u201cthere was no insolvency based on the fundamentals” at the time. The New York State Department of Financial Services reportedly said on March 14 that its closing the bank had \u201cnothing to do with crypto\u201d, citing the firm\u2019s failure to provide \u201creliable and consistent data\u201d to the regulator.<\/p>\n