The crypto industry’s inability to access banking services still concerns many industry observers despite recent policy victories.In past years, finan
The crypto industry’s inability to access banking services still concerns many industry observers despite recent policy victories.
In past years, financial services firms and banks concerned about fiduciary risk, reporting liabilities and reputational risk often would refuse to offer service to crypto firms — i.e., “debanking” them.
Legislative efforts in the United States and Australia are attempting to remove these barriers for the crypto industry. In the former, legislators repealed guidelines that made it difficult for banks to custody crypto assets, as well as those stating that crypto carried “reputational risk” for banks. In the latter, the Labor Party has introduced a bill to create a legal framework for crypto, giving banks the clarity they need to interact with the crypto industry.
Despite these tangible efforts, some crypto industry observers say that the crypto’s debanking problem is far from over.
US crypto execs say debanking is still an issue
The crypto industry has long decried “Operation Chokepoint 2.0,” its nickname for a suite of policies that they claim constrained the crypto industry from growing under the administration of former President Joe Biden. Among these were measures making it more difficult for crypto firms to access banking services.
The early days of the second administration of President Donald Trump have seen many of these repealed or changed. One of the first was the repeal of Staff Accounting Bulletin 121, which required banks offering custody for customers’ cryptocurrencies to list them as liabilities on their balance sheets — this made it very difficult for banks to justify offering such services.
The administration also appointed a new head of the Office of the Comptroller of the Currency (OCC), Rodney Hood. Dennis Porter, CEO of the Bitcoin-focused policy organization Satoshi Action, told Cointelegraph that under Hood’s tenure, the OCC has already said banks can offer crypto-related services like custody, stablecoin reserves and blockchain participation.
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“This opens the door for broader adoption of digital asset technology and custodial services by traditional financial institutions, signaling a major shift in how banks engage with crypto,” he said.
Despite these victories, Caitlin Long, founder and CEO of Custodia Bank, said on March 21 that debanking is likely to remain a problem for crypto firms into 2026.
Long said the non-partisan board of governors of the Federal Reserve is “still controlled by Democrats,” alluding to Democrats’ more skeptical stance on crypto. Long claimed that “there are two crypto-friendly banks under examination by the Fed right now, and an army of examiners was sent into these banks, including the examiners from Washington, a literal army just smothering the banks.”
Long noted that Trump won’t be able to appoint a new Fed governor until January, meaning that, while other agencies may be more crypto-friendly, there are still roadblocks.
Australia’s Labor Party to create crypto framework
Stand With Crypto, the “grassroots” crypto advocacy organization started by Coinbase that has spread to the US, UK, Canada and Australia, said that “in Australia, debanking is quietly shutting out innovators and entrepreneurs — particularly in the crypto and blockchain space.”
In a post on X, the organization claimed that debanking results in “reputational damage, loss of revenue, increased operational costs, and inability to launch or sustain services.” It also claimed that it forces some companies to move offshore.
In response to these concerns, the ruling center-left Labor Party in Australia has proposed a new set of laws for the cryptocurrency industry. The changes to current financial services law seek to tackle the issue of debanking in the country’s cryptocurrency industry.
Australia’s Treasury says its new crypto regulations have four priorities. Source: Australian Department of the Treasury
Edward Carroll, head of global markets and corporate finance at MHC Digital Group — an Australian crypto platform — told Cointelegraph that in Australia, debanking decisions were “not the result of regulatory directives.”
“Rather, they appear to stem from a more general sense of risk aversion due to the current lack of a clear regulatory framework.”
Related: US gov’t actions give clue about upcoming crypto regulation
Carroll was optimistic about the Labor Party’s proactive stance. The major political parties were “showing a shift in sentiment and a shared commitment to establishing formal crypto regulation.”
“We are hopeful that this will give banks the confidence to reengage with crypto businesses that meet compliance standards,” he said.
Canada unlikely to relieve crypto firms
In Canada, “debanking remains a serious and ongoing challenge for the Canadian crypto industry,” according to Morva Rohani,…
cointelegraph.com