Former Solicitor General Donald B. Verrilli, who now serves as Grayscale Investments’ senior legal strategist, raised concerns about US regulators intentionally stifling the crypto industry through debanking practices. In a joint amicus brief filed with Paul Clement, Verrilli highlighted bipartisan worries regarding the regulatory environment for digital assets. The brief, filed on behalf of Custodia Bank, challenged the Federal Reserve’s decision to deny the bank a Master Account based on discretion. Verrilli specifically pointed out that the Office of the Comptroller of the Currency (OCC) has issued informal guidance that effectively restricts banks’ engagement with crypto firms. He argued that these guidelines, while not official, impose strict requirements that hinder banks from supporting the growth of the crypto industry.
Verrilli and Clement’s joint statement suggested that such regulatory practices amount to a deliberate effort to debank the crypto industry, thereby impeding competition and innovation. They criticized the court’s decision in favor of the Fed, stating that it poses a significant obstacle for the crypto sector. These allegations reflect a broader bipartisan concern about the current regulatory approach toward digital assets. Fox Business journalist Eleanor Terrett reported on Verrilli’s perspective, emphasizing the potential repercussions of the Fed’s actions. Market analysts caution that without more adaptive regulations, the US could lose its competitive edge in the global crypto market.
Political Landscape and Crypto
Verrilli and Clement’s support for Custodia Bank indicates a shift in the political landscape surrounding cryptocurrencies, with bipartisan support growing as the November election approaches. Digital assets have become a significant issue in the upcoming 2024 US elections, influencing political discourse and voter behavior. The crypto industry has garnered momentum, with advocates pushing for favorable regulations and increased acceptance among lawmakers. This has led to heightened political engagement from industry stakeholders and voters interested in digital assets. Key political figures and presidential candidates are increasingly aligning themselves with the crypto sector to mobilize younger voters, who are more likely to invest in cryptocurrencies.
Former President Donald Trump has pledged to support digital asset traders and is now accepting campaign contributions in cryptocurrencies. On the Democratic side, Robert F. Kennedy Jr. has also embraced cryptocurrencies, advocating for Americans’ rights to use and hold digital assets. This growing political alignment is crucial for rallying younger voters, who could have a significant impact on close elections. A poll by the Crypto Council for Innovation (CCI) revealed that a candidate’s stance on digital assets is essential to many voters, with 83% preferring candidates who advocate for clear crypto regulations. Crypto entities are gearing up to spend over $80 million on the elections, aiming to boost allies and promote legislation favorable to the industry.
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