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Ripple Chief Technical Officer David Schwartz recently joined other tech leaders in criticizing Operation Chokepoint 2.0, a purported government initiative targeting the crypto industry through de-banking.
Schwartz claimed that the government is “addicted to indirect regulation” and outlined four reasons why de-banking undermines the rule of law.
He argued that cutting off banking access pushes entities to switch service providers or operate underground, making them harder to regulate and monitor.
Schwartz also stated that de-banking erodes due process, freedom of speech, and protections against unlawful search and seizure.
“Our government has become addicted to indirect regulation precisely because of these evils.
It is cheaper and easier to pressure someone else to punish me than to charge me with a crime and give me due process, but the government ought not to punish people without giving them due process,” Schwartz wrote.
He added, “It is easier to pressure banks to cut off disfavored businesses than to make that business illegal,” calling on the government to regulate transparently and lawfully.
<h3 class="wp-block-heading" id="industry-leaders-share-experiences">Industry Leaders Share Experiences</h3>
Venture capitalist Marc Andreessen revealed that over 30 tech firms have been affected by Operation Chokepoint 2.0, with industry leaders recounting their experiences.
Frax Finance founder Sam Kazemian said JPMorgan Chase debanked him in December 2022.
Coinbase CEO Brian Armstrong has filed a Freedom of Information Act (FOIA) request to uncover details about the operation and is compiling records.
In September 2024, Castle Island Ventures partner Nic Carter accused the Biden administration of deliberately shutting down Silvergate Bank to harm the crypto sector.
“I believe Silvergate could have survived its drawdown — and was on a path to do so,” Carter said.
Despite these challenges, industry executives remain hopeful that the incoming Trump administration will reverse the regulatory hostility faced by the crypto industry.

Ripple CTO Hits Out at US Government for Regulation

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