US President-elect Donald Trump’s transition team is contemplating a major overhaul of the country’s banking regulators, potentially merging or eliminating agencies like the Federal Deposit Insurance Corp (FDIC). Trump’s advisors and the Department of Government Efficiency (DOGE) officials are exploring the possibilities of abolishing these regulatory bodies. This move aligns with Trump’s crypto-friendly stance and has sparked optimism within the crypto community, anticipating an end to the controversial ‘Operation Chokepoint 2.0.’
According to the latest Reuters report, the team has asked the nominees to lead the FDIC and the Office of the Comptroller of the Currency about transferring the FDIC’s responsibilities to the Treasury Department. They asked if deposit insurance could be absorbed into the Treasury Department. However, any proposal to eliminate the FDIC or any agency would require congressional approval.
As Trump and the leads of DOGE, Elon Musk and Vivek Ramaswamy, take the initiative to reform the banking regulatory landscape, the crypto space is abuzz with excitement. In light of the current regulatory environment, the potential restructuring of banking regulatory forces could have a significant impact on the US financial landscape.
The country has been plagued by a lack of clear regulations and restrictive policies, especially in the cryptocurrency and financial industries. Notably, the buzzword ‘Operation Chokepoint 2.0’ has emerged recently, sending shockwaves through the sectors. The term refers to the government’s “indirect regulation” over the crypto space, as pointed out by Ripple CTO David Schwartz. In simple terms, agencies like FDIC forced banks and other financial institutions to cut off ties with crypto companies, creating an uncertain and challenging environment for platforms and investors.
Andreessen Horowitz’s Quintenz Leads CFTC Race Under TrumpIf the Trump administration eliminates FDIC from banking regulations, the crypto industry could attain visible gains. For instance, banking institutions will no longer be urged to limit connections with crypto policies. Thus, exchanges and companies could have better access to banking services.
The recent appointments of the SEC Chair Paul Atkins and the Crypto Czar David Sacks have sparked optimism in the industry. Both Atkins and Sacks have a history of supporting the crypto industry, which further fuels the community’s enthusiasm. In addition, Sacks, in a recent X post, highlighted his commitment to saving the crypto market from Operation Chokepoint 2.0.
