Over the past three years, there has been a trend among cryptocurrency hedge funds to struggle to secure banking services.
The issue highlights the far-reaching implications of what the cryptocurrency industry is calling “Operation Chokepoint 2.0.”
Cryptocurrency Banking Issues… Industry Discrimination Debate Deepens
The Wall Street Journal sheds light on the issue, citing a recent survey by the Alternative Investment Management Association (AIMA). According to the report , about 120 of the roughly 160 cryptocurrency-focused hedge funds , or about 75 percent of respondents, have experienced disruptions in banking services.
In contrast, a survey of 20 alternative investors across a range of sectors, including real estate and private credit, reported no such challenges.
The banking issues with crypto funds ranged from vague communication to account closures without a clear explanation. The reasons given were mainly that banks were reluctant to get involved with the volatile cryptocurrency market.
This gap in banking access has raised concerns among major crypto executives . Coinbase’s chief legal officer, Paul Grewal, has questioned why so many of these funds have had banking issues when others have not. This issue suggests that crypto companies may be systematically excluded from banking services.
Meanwhile, Matt Hogan, Bitwise’s chief investment officer, expressed relief that these banking issues are being discussed more openly. He noted that the crypto community has long been aware of these issues, but when they have been discussed publicly, they have been met with skepticism or outright denial from outsiders.
Hogan described the situation as a form of gaslighting that caused some in the industry to question the legitimacy of his experiences.
“It’s really relieving to see this being discussed publicly. Everyone in crypto saw this happening in real time, but when you try to talk about it, people shrug their shoulders or suggest you’re making it up,” Hogan said .
However, industry stakeholders are hoping for a change under President Donald Trump’s new, crypto-friendly administration. Already , newly appointed AI and crypto czar David Sacks has acknowledged the damage they have done to crypto-related businesses, emphasizing the need to investigate these restrictive banking practices.
