Major US Banks Accused of ‘Debanking’ Crypto Firms

Regulators Flag Widespread ‘Debanking’ Practices

Crypto companies were among several industries allegedly denied access to essential banking services by nine of the largest U.S. banks, according to preliminary findings released by the Office of the Comptroller of the Currency (OCC). The review suggests that between 2020 and 2023, major banks imposed internal restrictions, heightened scrutiny or outright service denials targeting politically sensitive or controversial industries.

The OCC revealed that banks “made inappropriate distinctions among customers” based solely on their lawful business activities. For the crypto sector, this meant exchanges, issuers and service providers faced additional barriers attributed to perceived risks of financial crime - even when fully compliant with federal guidelines.

Crypto Groups Lumped With High-Risk Sectors

The report highlighted a pattern of what regulators describe as sector-wide discrimination, placing crypto alongside industries such as firearms, private prisons, coal mining, oil and gas, tobacco and adult entertainment. While banks defended these policies as safeguards against money laundering or operational risk, the OCC suggested such justifications may have overstepped legal boundaries. 

Crypto firms were often flagged for enhanced review protocols, meaning transactions, account openings and operational permissions required escalated approvals. The OCC noted that these restrictions were sometimes implemented quietly, despite public-facing assurances that banks were not engaging in targeted debanking.

Banks Under Federal Scrutiny as Political Pressure Rises

The OCC investigation stems from an executive order signed in August by President Donald Trump, directing regulators to examine whether banks discriminated against individuals or companies based on political or religious affiliation. While the order was broader in scope, the crypto industry became a focal point as evidence emerged that banks had systematically limited services due to regulatory uncertainty under prior administrations.

The nine banks under review include JPMorgan Chase, Bank of America, Wells Fargo, Citibank, US Bank, Capital One, PNC, TD Bank and BMO. The OCC confirmed the inquiry is ongoing and may escalate to the Department of Justice, signaling potential legal consequences ahead.

Critics Say Report Avoids Blaming Key Regulators

Not everyone is satisfied with the OCC’s initial report. Nick Anthony from the Cato Institute argued that the findings “leave much to be desired” pointing out that the OCC failed to mention that banks themselves are judged partly on reputational risk - giving them incentive to avoid controversial clients. Anthony also noted that the FDIC previously warned banks to distance themselves from crypto firms, a policy he says directly contributed to widespread debanking.

Caitlin Long, CEO of Custodia Bank, echoed this sentiment, stating that the “worst culprits” during the Biden administration were the FDIC and the Federal Reserve, not the OCC. She added that large banks were not the primary targets of anti-crypto pressure; instead, mid-sized and specialized institutions bore the brunt of regulatory crackdowns.

Crypto Industry Awaits Final Conclusions

For now, the OCC's work continues, and the crypto sector remains wary of the implications. The investigation’s final report could reshape how financial institutions evaluate risk and ensure equal access to banking. With millions of Americans relying on crypto companies for trading, payments and savings, the outcome may determine whether debanking practices become regulated, restricted or completely outlawed in the U.S.