tl;dr
The Wall Street Journal reported that cryptocurrency hedge funds are facing difficulties in securing banking services, with approximately 75% of them encountering obstacles, while other sectors reported no such issues. Reasons for the banking challenges included ambiguous communications and account ...
Cryptocurrency hedge funds are facing challenges in securing banking services, raising concerns of industry discrimination as reported by the Wall Street Journal. Approximately 75% of crypto-focused hedge funds encounter obstacles with banking services, while other sectors report no such difficulties.
The banking challenges for crypto funds range from ambiguous communications to outright account closures, fueling concerns of systematic exclusion from banking services. Industry stakeholders are hopeful for a shift with the incoming crypto-friendly administration, emphasizing the need to investigate restrictive banking practices.
Top crypto platforms for December 2024: Phemex, BYDFi, Margex, BingX, Coinex
The Wall Street Journal reported that cryptocurrency hedge funds are facing difficulties in securing banking services, with approximately 75% of them encountering obstacles, while other sectors reported no such issues. Reasons for the banking challenges included ambiguous communications and account closures, often due to banks' reluctance to engage with the volatile cryptocurrency market.
This disparity has raised concerns about potential systematic exclusion of crypto entities from banking services. Industry stakeholders are hopeful for a shift with the incoming administration, as the newly appointed AI and Crypto Czar has stressed the need to investigate these restrictive banking practices.
Over the last three years, an alarming trend has emerged among cryptocurrency hedge funds — a troubling difficulty in securing banking services. This issue highlights the broader impact of what many in the cryptocurrency sector refer to as “Operation Chokepoint 2.0.”
Wall Street Journal, citing a recent survey by the Alternative Investment Management Association (AIMA), shed light on this pervasive problem. The report found that approximately 120 out of 160 crypto-focused hedge funds — constituting about 75% of the respondents — faced obstacles with their banking services.
In contrast, a survey of 20 alternative investors from different sectors, including real estate and private credit, reported no such difficulties. The banking challenges for crypto funds ranged from ambiguous communications to outright account closures, often without clear explanations. When reasons were provided, they typically related to banks’ reluctance to associate with the volatile cryptocurrency market.
This disparity in banking accessibility has sparked significant concern among top crypto executives. Paul Grewal, Coinbase’s Chief Legal Officer, questioned why a significant percentage of these funds encountered banking issues while their counterparts in other sectors did not. This issue points to a potential systematic exclusion of crypto entities from banking services.
Meanwhile, Matt Hougan, Chief Investment Officer at Bitwise, expressed relief that these banking challenges are now being discussed more openly. He noted that the crypto community has long been aware of these issues, though discussing them publicly often led to skepticism or outright denial from outsiders.
Hougan described the situation as a form of gaslighting that made some in the industry question the legitimacy of their experiences.
However, industry stakeholders are hopeful for a shift with President Donald Trump’s more crypto-friendly incoming administration. Already, David Sacks, the newly appointed AI and Crypto Czar, stressed the need to investigate these restrictive banking practices while acknowledging the damage they have inflicted on crypto-related businesses.
🎄Top crypto platforms | December 2024 Phemex, BYDFi, Margex, BingX, Coinex
Phemex, BYDFi, Margex, BingX, Coinex
Phemex, BYDFi, Margex, BingX, Coinex
Phemex, BYDFi, Margex, BingX, Coinex