Rep. French Hill announced plans to step up scrutiny of regulators’ alleged efforts to cut off crypto activities from banking services, citing concerns raised by industry executives and recent public statements by the co-founder of a16z, Marc Andreessen.
Hill, who is in the running to lead the House Financial Services Committee next year, expressed his concerns at a Dec. 3 financial technology hearing that featured testimony from several prominent leaders in the sector.
Hill said:
“Legal businesses in this country must have access to banking and financial services. This committee will investigate these issues in depth during the next Congress.
Operation Chokepoint 2.0
Andreessen recently appeared on the Joe Rogan podcast and discussed federal authorities allegedly pressuring banks to terminate accounts associated with crypto and other sectors.
The claim has reignited concerns about “Operation Choke Point 2.0,” a phrase used to describe suspected attempts to restrict access to banking services for certain sectors. The original Operation Choke Point was a Justice Department initiative launched in 2013 to limit financial services to industries deemed at high risk of fraud, such as payday lenders.
Executives from Stellar Development Foundation and Anchorage Digital testified at the hearing that their businesses had been affected. Stellar CEO Denelle Dixon described the challenges of maintaining banking relationships.
She said:
“We had to contact ten different banks, and no reasons were provided for the refusals.”
Congressional dynamics and politics
Hill’s comments come as leadership of the House Financial Services Committee is set to change. The current chairman, Patrick McHenry, R-N.C., is retiring, and Hill and other pro-crypto Republicans are vying to fill the position.
While newly elected President Donald Trump has pledged to end regulatory efforts similar to Operation Choke Point, the coming year could mark a shift in how Congress approaches crypto and financial access.
The Federal Deposit Insurance Corporation (FDIC) noted in a 2024 report that banking institutions are not prohibited from serving specific industries. However, Hill and other lawmakers question whether these policies are applied uniformly.
The hearing also touched on the ongoing debate over stablecoin regulation, with lawmakers questioning the extent to which oversight should be delegated to state regulators. Hill expressed optimism that crypto legislation would move forward despite time constraints.
He said:
“We have made significant progress and I believe we can reach consensus.”
Meanwhile, Rep. Maxine Waters, Democrat of California, who worked with McHenry on a bipartisan stablecoin framework, expressed hope that a deal could be reached before the end of the year. However, she acknowledged the challenges posed by a busy legislative schedule.
Waters said:
“I have always appreciated Mr. McHenry’s efforts to find common ground. Hopefully we can see significant progress before the new Congress begins.
