US sanctions against Venezuela have now extended to the financial sector, with JPMorgan Chase recently freezing the accounts of two stablecoin startups, Blindpay and Kontigo, sparking another clash between the banking system and crypto companies. The bank has consistently denied any wrongdoing, emphasizing that it was compelled by current regulations.
The freezing moment for banks and startups: Why did JPMorgan Chase step in?
According to The Information , JPMorgan Chase recently froze the accounts of Blindpay and Kontigo, stablecoin payment companies backed by the well-known startup accelerator Y Combinator, seemingly because their services involve high-risk sanctioned regions such as Venezuela.
It is understood that both companies have established connections with JPMorgan Chase through the US payment company Checkbook, and the bank took immediate action after learning of the news.
JPMorgan Chase emphasized that this move is unrelated to "targeting stablecoin or crypto companies": "We provide banking services to stablecoin issuers, as well as services related to stablecoin businesses, and we recently assisted a stablecoin issuer in going public."
It is easy to understand that, in the face of legal risks that may attract the attention of the U.S. Securities and Exchange Commission (SEC) or the Treasury Department, banks must understand the counterparties and sources of funds of their clients in order to avoid crossing regulatory red lines.
Chokepoint 2.0? Is the crypto industry being targeted?
Since the previous Biden administration, there has been a constant stream of law enforcement and crackdown actions surrounding the crypto industry and traditional finance, known as " Chokepoint 2.0 ".
Devin Nunes, CEO of Trump Media, Jack Mallers, CEO of Strike, Houston Morgan, marketing director of ShapeShift, and more than 30 other founders in the technology and crypto industries have accused JPMorgan Chase of closing accounts or refusing to provide services without cause.
Trump takes a tougher stance: intercepting oil tankers and seizing oil.
Returning to the current context, the Trump administration has further escalated its comprehensive pressure on Venezuela. In the past two weeks, the United States has intercepted and detained two oil tankers loaded with Venezuelan oil, to which Trump has responded with a sarcastic remark:
We might sell it, we might keep it, or we might use it for strategic reserves.
It is understood that the recent sanctions have focused on Venezuela's state-owned oil company PDVSA, which has been blacklisted since 2019. The U.S. Treasury Department accuses the country of using its oil revenues to support the Maduro regime and on December 11 imposed further sanctions on six shipping companies that assisted in transporting oil and were suspected of shutting down location tracking or falsifying navigation data.
How can startups, under geopolitical pressure, contend with bank regulation?
In an environment of tightening sanctions and geopolitical sensitivity, banks must be more cautious about any financial flows involving high-risk regulated countries.
For JPMorgan Chase, crypto payment companies that have dealings with sanctioned regions face higher scrutiny than traditional companies, so they are more inclined to "act first and ask questions later" to avoid being targeted by regulators.
The article " Chokepoint 2.0? JPMorgan Chase freezes accounts of two stablecoin startups due to Venezuelan sanctions" first appeared on ABMedia, a ABMedia .
