Fmr Obama Solicitor Says Regulators Are “Deliberately Debanking Crypto”

Donald B. Verrilli, the Former Solicitor General under the Obama Administration has weighed in on crypto regulation in the US. Linked to Grayscale Investments, Verrilli has first-hand experience in dealing with the bottleneck around crypto regulation in the country.

Crypto Regulation: Debanking Crypto Innovators

Fox Business Journalist Eleanor Terrett spotlighted the take of Donald Verrilli, referencing the Custodia Bank legal tussle in the US. Recall that Custodia Bank and the Federal Reserve are locking horns regarding the failure of the latter to issue a Master Account to the former.

🚨NEW: Verrilli (Obama’s Solicitor General who was in office during the original Operation Chokepoint) and Clement (Bush’s Solicitor General) have clashed over a number of Supreme Court cases over the years but the pair have come together to support @custodiabank, and the #crypto… https://t.co/wGgoqZM0x7

— Eleanor Terrett (@EleanorTerrett) July 4, 2024

The immediate ruling in the case has favored the Federal Reserve, however, the case is far from over. According to Verrilli, the United States Office of the Comptroller of Currency (OCC) might have a hand in this. In a communique co-authored with Paul Clement, President Bush’s Solicitor General, the duo shed light on the directive of the OCC to banks.

Though the regulator tagged the guidance an informal one, it explicitly curtailed the ability of banks to do business with crypto firms. For an industry that is innovating at a fast pace, Verrilli and Clement noted that the conditions attached to banking crypto were daunting to meet.

With the duo wading into the crypto regulation challenges, analysts considers the political terrain is changing. While Eleanor Terrett blew open the position of Verrilli and Clement, she acknowledged that they have clashed in the past regarding Supreme Court cases.

Market experts believe the United States is falling back and might need futuristic crypto regulation to get back on track.

Legal Tussle For Crypto Exchanges

The digital currency ecosystem is not free from the grip of the United States Securities and Exchange Commission (SEC). In the Verrilli and Clement write-up, they cited the recent Coinbase lawsuit against the SEC and the FDIC.

Despite the pushback from Coinbase, the SEC has continued to file lawsuit against top firms in the industry. At the moment, the regulator has existing cases with Ripple Labs, Uniswap and more recently ConsenSys among others.

The crypto ecosystem is more united now than ever and there are coalition funding the next US election. The goal is to help more crypto focused lawmakers land seats in DC.

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