On November 25, the House Financial Services Committee majority staff published Operation Chokepoint 2.0: Biden’s Debanking of Digital Assets, a detailed account of how, in the Committee’s view, federal prudential regulators between 2021 and early 2025 discouraged banks from serving lawful digital asset businesses through informal guidance, supervisory posture, and enforcement.

On December 1, Comptroller of the Currency Jonathan Gould issued a statement largely concurring with the report’s central premise and outlining corrective actions the Office of the Comptroller of the Currency (OCC) has taken to increase transparency, retire “reputation risk” as a supervisory lever, and investigate alleged unlawful debanking by large institutions. Together, the report and the OCC’s response mark a significant shift in tone and expectations for bank engagement with crypto-assets.

What the House Report Says
The Committee majority staff’s report contends that Chokepoint 2.0 was manifested through a series of policy statements, supervisory programs, and accounting guidance that created legal uncertainty and elevated perceived “reputational risk” for banks that served digital asset firms. It points to Federal Reserve (Fed) Supervision and Regulation letters (SR) requiring notifications and non‑objection processes for novel and dollar‑token activities, the Fed’s Novel Activities Supervision Program, interagency joint statements emphasizing crypto‑asset risks on open/public networks and stablecoin run risk, the Federal Deposit Insurance Corporation’s (FDIC) “pause” letters instructing institutions to halt or delay crypto activities while responding to expansive requests, and the OCC’s Interpretive Letter 1179 (IL 1779) conditioning crypto custody, stablecoin reserves, and distributed‑ledger participation on case‑by‑case non‑objections. It also highlights the Securities and Exchange Commission’s (SEC) regulation‑by‑enforcement approach and Staff Accounting Bulletin 121, which effectively discouraged banks from digital‑asset custody by requiring on‑balance‑sheet recognition of safeguarded assets (later rescinded in 2025). According to the report, the cumulative effect of these actions produced at least 30 account closures and a broader chilling effect that pushed innovation offshore and deprived U.S. consumers and businesses of access to regulated payment rails.

The OCC’s December 1 Statement
Comptroller Gould’s response carries three notable signals for supervised institutions:

• It acknowledges that the OCC’s prior supervisory posture discouraged bank engagement with digital assets and pledges transparency by publishing each formal IL 1179 request and the OCC’s response, opening a new window into the criteria and dialogue that shaped outcomes.
• It confirms that the OCC has removed references to “reputation risk” across its examination handbooks and guidance and, with the FDIC, issued a proposal to codify the elimination of “reputation risk” from supervisory programs, thereby directly addressing a historically subjective concept that banks often cited to decline or terminate lawful but politically sensitive customer relationships.
• It commits to continued investigation into the role of the largest banks in debanking digital asset customers or other lawful businesses, with a stated intent to hold institutions accountable for any unlawful debanking and to ensure access based on individualized, objective, risk‑based analyses consistent with the President’s Executive Order 14331 on Guaranteeing Fair Banking for All Americans.

The Regulatory Reset Already Underway
The OCC’s pivot is part of a broader 2025 recalibration across the prudential and market regulators. The Fed withdrew SR 22‑6 and SR 23‑8, sunsetted SR 23‑7’s Novel Activities Supervision Program, and removed “reputational risk” from examination programs, retraining examiners to focus on specific financial risks. The Fed, FDIC, and OCC jointly withdrew prior “crypto risk” statements and issued a new joint statement in July reframing risk‑management considerations without categorical discouragements. The FDIC publicly released the Biden‑era “pause” letters, clarified in FIL‑7‑2025 that prior FDIC approval is not required for permissible crypto activities, and joined the OCC in proposing to codify the elimination of “reputation risk.” The OCC rescinded IL 1179 and clarified, through IL 1183, that crypto custody, certain stablecoin activities, and participation in distributed ledgers are permissible when conducted safely and soundly. In parallel, the SEC rescinded SAB 121 (via SAB 122), narrowed crypto‑related enforcement initiatives, and launched “Project Crypto” to modernize rules and create realistic paths to registration, complemented by Commodity Futures Trading Commission (CFTC) coordination in its “Crypto Sprint.” Congress, for its part, enacted the GENIUS Act, creating the first federal framework for payment stablecoins and setting up near‑term rulemakings on reserves, disclosures, and compliance.

Our Take

The House report and the OCC’s response together mark an inflection point in bank–crypto engagement. Federal prudential regulators are moving away from implicit discouragement premised on “reputation risk” and toward individualized, risk‑based decisions anchored in safety and soundness, while all market regulators are beginning to modernize rules for digital assets and stablecoins.