Nic Carter, Co-founder of Coin Metrics, claims that the FDIC is still – post election – insisting on a 15% depository cap on banking institutions that are serving crypto firms (as he has been told).
Nic Carter also described the FDIC as an abominable agency. Carter added that Trump needs to absolutely clean house.
The FDIC is still – post election – insisting on a 15% depository cap on banks serving crypto firms, I am told. Abominable agency. Trump needs to absolutely clean house
— nic 🎄 carter (@nic__carter) November 12, 2024
Carter also mentioned via X that it takes a lot of “audacity” to keep doing this even after the Coinbase FOIAs and OCP2.0 “galvanizing” the crypto vote.
Responding to Nic Carter’s remarks, Caitlin Long, the founder at Custodia Bank (which had announced layoffs due to operational challenges) said that it’s more than that.
Long pointed out that the FDIC and Fed are still pressuring banks to exit crypto entirely, as recently as 10 days ago, and she claims to have “proof.” Long further claimed that soon we will know the full extent of all the debanking. Long believes that the truth will shock us.
Although both Carter and Long seem to have legitimate concerns about whether crypto firms are being treated fairly, the truth is companies dealing in highly volatile virtual currencies have proven to be very unreliable over the years. For instance, many crypto products are rushed to the market without proper due diligence or adequate research.
For reputable banking institutions to serve crypto firms would understandably require them to be willing to take on some level of risk, which might not be in their best interests. As crypto industry observers know very well by now, seemingly innovative firms such as FTX have damaged the industry’s reputation to a great extent. Due to the irresponsible actions of many bad actors, the whole industry has suffered.
However, clear policy and an updated regulatory framework will allow banking institutions to gain the confidence they need to work cooperatively with more crypto firms. It’s also worth noting that Long had previously criticized US authorities for favoring systemically important larger banks over smaller banks. But, again, the reality is that systemically important banking institutions are absolutely essential for the financial stability of both individuals and businesses.
With that being said, the digital assets and web3 ecosystem can only mature if industry participants take a moment to reflect on their conduct and their decision-making at every step. When the industry has matured and industry professionals have learned to assume the responsibility of safeguarding the interests of the ecosystem in a cooperative manner, then we will be able to move forward in a progressive manner.
