We cannot live in a world where someone starts a company that is completely legal, and then is literally () controlled () and embargoed by the United States government through a (process) a is completely unaccountable. No due process. None of this is written down. There are no rules. There is no court, there is no decision-making process. There is no appeal. Who are you appealing to, right? () Who do you go to get your bank account back?
– Marc Andreessen, talking to Joe Roganpublished on 11/26/2024
In another troubling manifestation of “Chokepoint 2.0,” a Wyoming company was briefly shut down in early November, 2024, by Mercurybanking platform operated by Evolve Bank (and other banking partners). After years of uninterrupted activity and excellent service, Mercury suddenly terminated the account for no apparent reason. The excuse? A vague nod to “internal factors” that remain as vague as the possible regulatory pressures behind them.
Let's be clear: The company's banking operations were not without controversy. The only possible offense is that the company accepts a large portion of its customer payments in Bitcoin. In addition to monthly wires from Kraken (a regulated crypto exchange), his transactions included rent, utility payments, hardware store purchases, and subcontractor invoices.
The limit could have had nothing to do with risky behavior or financial misconduct. Rather, the shutdown is symbolic of a systematic effort to discourage Bitcoin businesses by exploiting the centralized banking choke points that regulators have turned into tools of suppression.
This is Chokepoint 2.0 in action. Regulators have found new ways to suppress businesses they disapprove of – this time, targeting Bitcoin miners and businesses. Instead of legislative debate or due process, unelected bureaucrats leverage their oversight of banks to “de-risk” clients who engage in perfectly legal activities. The company was just collateral damage in the drive to separate Bitcoin from the traditional financial system.
This is a chilling echo of Operation Chokepoint 1.0, where federal regulators illegally pressured banks to cut services to legal but illegal businesses, such as gun dealers and payday lenders . That campaign it ended in disgrace when the FDIC was forced to settle a lawsuit in 2019. The settlement confirmed what should be obvious: the financial system's weapon against legal businesses is unconstitutional. Management knows this – and yet here we are again.
Why is this important?
A bank deposit is not just an inconvenience. For businesses, it is essential. Operating without a trusted banking partner in today's economy is like trying to breathe without air. When banks are forced to break ties with companies related to Bitcoin, it sends a chilling message: participate in this business at your peril. It also stifles innovation, a dangerous precedent for a country based on economic freedom.
Furthermore, this practice undermines the concept of fairness in financial services. The American banking system is not a private fiefdom. It operates under public contracts and with public trust, and its gatekeepers should not be arbiters of political or ideological purity.
The harm extends beyond Bitcoin. If management can hijack this industry, what's stopping them from targeting others? What happens when innovative, dissenting or inconvenient truths are deemed “too dangerous” for the comfort of established powers? This is about more than Bitcoin – it's about the integrity of the financial system and the preservation of free markets.
A Call to Action: Accountability for Managers
The new Congress and the Trump administration must seize this moment to hold the architects of Chokepoint 2.0 accountable. This is not a partisan issue; it is a constitution. Regulators who act as de facto legislators, implementing policies that never survive public scrutiny, must be regulated.
- Studies of Regulatory Overreach
Congress must launch comprehensive investigations into the groups that are pressuring banks to sever ties with Bitcoin businesses. Who issued these guidelines? Under what authority? The American people deserve answers, and the criminal parties deserve consequences.
- Personal Accountability for Managers
Bureaucrats who abuse their power should not be protected by the anonymity of the governing apparatus. Those responsible for weaponizing the financial system against legitimate businesses must be named, shamed, and removed from their positions, losing any security clearances they may have. ' they could have, and could lose government pensions and retirement benefits.
- Appropriate process recovery
Any decisions to limit banking access should require clear, codified standards and a transparent appeals process. No more shadow rules. If a business is to be deleted, the reasons should be public, defensible, clearly stated and explained, based on the law, and be attractive.
- Legislation to Protect Financial Opportunity
Congress should pass laws that prohibit banks from discriminating against legitimate businesses based on political or ideological reasons. The free market thrives on neutrality; it fades under inclination.
- Distribution of financial systems
Bitcoin exists as a hedge against just such an overreach. Policymakers should embrace it and encourage it to grow, not fight it. America cannot afford to fall behind in the global race for financial innovation.
Much of the above could be dealt with through this Section 10 of the SAFE Banking Actwhich directly limits the influence of undue regulation on banking services. Specifically, it prohibits federal banking agencies from pressuring financial institutions to terminate relationships with legal businesses, including those in the Bitcoin and cryptocurrency industry, based on reputational risks or political incentives. This provision reinforces the principle that decisions about financial services should be based on a risk-based analysis of individual accounts rather than a broad bias against entire businesses. By codifying such protections, the SAFER Banking Act would promote fairness and transparency in financial services, ensuring that regulators comply with their duties of impartial oversight while providing respect the rights of businesses operating legally under state or federal law.
In addition to legislative solutions, the presence of even one bank with the willingness and ability to withstand unnecessary regulatory pressure could significantly reshape the financial landscape of Bitcoin businesses. Caitlin Long's Bank Custodianbased in Wyoming, is an example of this ability. Custodia has consistently demonstrated its commitment to working within the law while challenging the overreach of federal regulators, as seen in his lawsuit against the Federal Reserve.
A bank with this level of resolution, direct access to the Federal Reserve itself, and a proven track record of standing up to regulators will provide a lifeline for Bitcoin (and other) businesses seeking reliable financial services. By fostering an ecosystem where legal businesses can thrive without fear of arbitrary pre-banking, Banca Custodia offers a template for how other institutions could follow suit, ensuring that innovation and economic freedom are still protected.1
Taken together, the SAFE Banking Act and the persistence of institutions like Banca Custodia represent two vital aspects in the fight against financial discrimination. While the SAFER Act provides a legislative framework to prevent regulatory overreach and protect legitimate businesses from bank money, it has faced significant opposition, having been entered several times in Congress only to be blocked again. At the same time, Banca Custodia's struggle underscores the seriousness of institutional tyranny; when the Federal Reserve refused to give Guardians access to the banking system the bank was forced to file a federal lawsuit just to claim its rightful place in the financial ecosystem. These challenges highlight the resistance to reform, but they also emphasize the urgent need for a multifaceted strategy – legislative, judicial and industrial – to ensure that have fair and impartial access to banking services for all legal businesses.
Bitcoiners: the front line of freedom
Bitcoin is not just money; it's an idea—an idea that money and power belong to the people, not the state. That's why we're here. That's why Bitcoin exists. The legacy financial system is collapsing under its own corruption, and every crackdown only reinforces the need for decentralized alternatives.
To be clear, no all in all Blame Mercury and Evolve for this. They will likely be introduced to it by their rulers.2 Of course, because of the Orwellian Bank Secrecy Act, the banks is not allowed to disclose the reasons for these issues to the affected customers. Banks like Mercury, and others who have willingly cooperated with Chokepoint 2.0 should be subject to Congressional Subpoenas to explain themselves, and also name and shame the regulators who co-opted them.
The future of Bitcoin – and America's place as a leader in innovation – depends on exposing and removing Chokepoint 2.0, and holding everyone who participated in it accountable.
1 In fact, Banca Custodia does not have a main account delete access to government censorship, but it makes it direct and open, rather than the indirect, hidden and unstable path that the rulers can take now. See this x-post by Caitlin Long.
2 Another reason to believe that, in the case of Mercury and Evolve, is that the regulators are responsible, Evolve Bank was penalized in June 2024 by the Federal Reserve, and apparently forced into to these actions by their overbearing and overactive rulers as part of that punishment. .
This is a guest post by Colin Crossman. Their views are entirely theirs and do not necessarily reflect the views of BTC Inc or Bitcoin Magazine.
