Since the collapse of three American banks friendly to cryptocurrency businesses and the U.S. government’s insistence that crypto assets are “risky investments,” many speculators believe bureaucrats are purposely closing access to cryptocurrencies. Some refer to the U.S. government’s recent enforcement as “Operation Chokepoint,” a mission aimed at eliminating access to the crypto ecosystem in the United States.
Bank Shutdowns Raise Concerns About U.S. Government’s Stance on Crypto
In recent weeks, crypto advocates have discussed U.S. government enforcement actions toward digital currency projects and businesses such as crypto exchanges. The collapse of Silvergate Bank, Silicon Valley Bank, and Signature Bank has led many to believe the U.S. government is closing access to crypto services. For example, with Signature Bank’s shutdown, spectators were confused about why it happened. Adding to the speculation, Signature board member and former politician Barney Frank said regulators shut down Signature to send an “anti-crypto” message.
Operation Chokepoint 2.0 is the next big scandal every other independent commentator will miss. The same people who told you to “lockdown or you’re a shill for Wall Street” are NOT the people to listen to now. These bank “collapses” were targeted crypto assassinations.
— Kim Iversen (@KimIversenShow) March 20, 2023
Regulators from New York and the Federal Deposit Insurance Corporation (FDIC) insisted the shutdown had nothing to do with crypto. However, when Signature’s assets and bank branches were acquired, new owner Flagstar Bank opted not to acquire Signature’s digital currency business. U.S. senator Elizabeth Warren of Massachusetts blamed crypto risk for Silvergate’s liquidation and many other U.S. politicians joined her chorus. The White House also published its economic report and downplayed crypto assets, noting they do not fulfill the properties of sound money and have failed their purported goals.
Operation Chokepoint 2.0. pic.twitter.com/eoVui87pgu
— Radar🚨 (@RadarHits) March 20, 2023
All this and enforcement from the U.S. Securities and Exchange Commission have led people to believe the U.S. government wants to oust crypto businesses. Many crypto proponents call the mission “Operation Chokepoint.” On March 13, bitcoiner Nic Carter tweeted about the alleged mission and said he warned about chokepoint a month ago. “I didn’t think in a million years they would go 100x further and actually take down the top three crypto-facing banks,” Carter said. “It’s breathtaking. And this wasn’t an accident. It was a demolition.” He also wrote a comprehensive blog post about the subject on Pirate Wires. The post details “the Biden administration’s coordinated, ongoing effort across virtually every U.S. financial regulator to deny crypto firms access to banking services.”
Closing the Exits
Bitcoin advocate Alistair Milne said: “The U.S. imposing capital controls (‘Operation Chokepoint’) means they are afraid for the dominance of the USD. The [U.S. dollar] is being eroded from [three] sides: Bitcoin’s fixed supply safe haven, inability/unwillingness to stop printing trillions (MMT), [and] BRICS scaling non-USD trade.” Venture capitalist Balaji Srinivasan recently said hyperinflation is happening now and believes bitcoin can reach $1 million per coin in 90 days. Srinivasan also agrees that access to crypto is closing.
“The Fed is closing the exits,” Srinivasan opined, referring to Kraken’s recent decision to pause ACH transfers. “They can’t do so globally. There are now enough banks outside Fed control. But if you’re within the broad West … You may only have weeks or even days. Buy bitcoin and get your coins off exchanges.” In another tweet, Srinivasan stressed that people should go to crypto-friendly destinations as it’s possible bitcoin could be outlawed like gold was in the U.S. in the 1930s.
They’re going to attempt to limit/block the exit ramps to bitcoin exchanges as the banking system gets run.
— Dylan LeClair 🟠 (@DylanLeClair_) March 22, 2023
Many others share Srinivasan’s view and that of Operation Chokepoint believers. The Twitter account called Stack Hodler asked: “What good is bitcoin if they close the on and off ramps?” The individual continued by answering his own question: “Closing the ramps means trapping you in the room with $31.6 trillion worth of debt. Get your monetary energy outside of the system BEFORE they debase/confiscate your entire life savings. Once you have your monetary energy in a neutral reserve asset, you may need to physically move to a friendly jurisdiction to benefit from it. But at least you’ll have the option.”
Bitcoin supporter Michael Ruiz wrote: “Bitcoin circular economy or bust. On and off ramps are shutting down,” sharing a screenshot of the Kraken ACH news. However, not everyone is as enthusiastic as some bitcoiners who believe bitcoin will provide better options. With the government cracking down and regulators in full force, some are skeptical about unfinished scaling solutions and the fact that bitcoin adoption hasn’t produced a circular economy. Furthermore, people have questioned Srinivasan and others about the government banning off-ramps and what people should do if that happens.
“So we all buy bitcoin and get it off exchanges, if there are no on-off ramps, what do we do? What’s the future from here? How do we trade, how do we spend it?” one person asked Srinivasan in his Twitter thread.
What do you think about the U.S. government’s actions towards crypto businesses and assets? Do you believe they are purposely closing access to cryptocurrencies? Share your thoughts about this subject in the comments section below.
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