If the United States government really implements “Operation Choke Point 2.0” it will destroy financial stability and may lead to the collapse of Silicon Valley Bank (SVB) according to Donald Trump’s former White House Chief of Staff, Mick Mulvaney.
“I don’t want to think that the government is going to do this,” Mulvaney said in a March 22 Bloomberg interview in reference to the rumored operation. But he recalled attending a hearing on the original Operation Choke Point — a government initiative aimed at restricting certain industries’ access to US banking services.
https://www.youtube.com/watch?v=b6M7OLFrxYI
“You have to wonder if there are certain policies implemented by the administration that have – may be intended, may be unintended – the consequences of raising the risk, and increasing the instability, and are we only seeing it in SVB?” he added.
“Are people in SVB because they are really good, or are there some factors there that say we are in SVB because no one else will take us.”
Mulvaney clarified that he believes crypto played no role in SVB’s collapse and suggested poor risk management was to blame. However, he pointed out, the pressure put on US banks to avoid crypto may have contributed to the collapse of SVB.
“Operation Choke Point 2.0” is a term coined by Coin Metrics co-founder Nic Carter and refers to a coordinated effort to prevent banks from holding crypto deposits or providing banking services to crypto companies on the basis of “safety and health” for banking. system.
I don’t want to sound the alarm, but since the turn of the year, a new Operation Choke Point-type operation has started targeting the crypto space in the US. It’s a well-coordinated effort to marginalize the industry and reduce connectivity to the banking system — and it’s working.
— nic carter (@nic__carter) February 7, 2023
While it is unclear whether “Operation Choke Point 2.0” is an official strategy, Carter said there is evidence to support its existence.
related: Yellen defended government intervention to prevent another SVB
In a blog post on February 9, Carter outlined some of the evidence he should have, highlighting a January 3 joint statement on crypto assets from the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC), which warned that decentralized blockchain networks “likely grossly inconsistent with safe and sound banking practices.”
More recently, critics have pointed to the FDIC’s disparate treatment of crypto assets when it took over Signature Bank as further evidence of “Operation Choke Point 2.0.”
Yes https://t.co/YkrVnLIXLA
— nic carter (@nic__carter) March 21, 2023
Magazine: The best and worst countries for crypto taxes – plus crypto tax tips