Days after JPMorgan Chase & Co. acknowledged banking cuts to President Donald Trump following the Jan. 6, 2021, attack on the Capitol, the Federal Reserve sought comments on its proposal that would prevent government regulators from forcing banks to sever ties with legitimate customers based on their activity, including cryptocurrency companies.
“We have heard of troubling cases of debanking in which regulators used concerns about reputational risk to pressure financial institutions to debank customers because of their political views, religious beliefs, or involvement in unpopular but legal businesses, including cryptocurrencies,” said Michelle W. Bowman, vice president of supervision.
“Discrimination by financial institutions on these bases is unlawful and plays no role in the Federal Reserve’s regulatory framework,” she added.
The rule process will codify the move as the U.S. Office of the Comptroller of the Currency, the nation’s bank regulator, moved last year to remove reputational considerations from its oversight, while the Federal Reserve similarly announced in July that such risks would no longer be part of its bank reviews.
While new examples continue to emerge, crypto debanking has been well documented and acknowledged by Trump-appointed bank regulators. In response to a lawsuit filed by Trump and the Trump Organization last month, JPMorgan Chase, the largest U.S. bank, said for the first time that it cut off more than 50 Trump accounts in February 2021. JPMorgan did not specify why it closed the accounts. On November 23, 2025, Jack Mallers, CEO of crypto payment company Strike, published a social media post stating that JPMorgan Chase had closed all of his accounts without reason, which immediately went viral on social media.
The Board’s proposal would “write into law the elimination of reputational risk from the Board’s regulatory programs,” and prohibit the Fed from “encouraging or coercing” banks to refuse services or impose conditions on customers who engage in “politically unpopular but lawful business activities,” Fed staff wrote in a Jan. 26 memo to the Board of Governors.
In the proposal, the Fed’s board said it intends to include “issuers of stablecoins that allow payments” into its definition of covered banking organizations upon completion of separate rulemaking, a move that could directly impact crypto-native companies seeking to enter the banking system.
The Fed said it would comment within 60 days from February 23 on its proposal to eliminate reputational risk from bank supervision.
