Senator Cynthia Lummis accuses the Federal Deposit Insurance Corporation (FDIC) of crypto misconduct

• Loomis accuses the FDIC of destroying documents related to cryptocurrencies and silencing employees.
• The Senator calls for transparency and warns against criminal referrals for obstruction.

Senator Cynthia Lummis (R-WY) has accused the Federal Deposit Insurance Corporation (FDIC) of misconduct in handling cryptocurrency oversight. In a letter To FDIC Chairman Marty Gruenberg, Loomis’ alleged whistleblower reported document destruction and employee intimidation related to the agency’s cryptocurrency activities.

The whistleblowers claimed that the FDIC destroyed important records and restricted employee access to sensitive data. Loomis stressed the need for transparency, describing these actions as “unacceptable and illegal.” It required the preservation of all digital asset-related materials since January 2022, including communications about Signature Bank, Silvergate Bank, and enforcement actions.

Lummis also warned of criminal referrals if the FDIC obstructs Senate oversight. She called for an end to retaliation against whistleblowers and urged the immediate preservation of all evidence. The Senator expressed her commitment to ensuring public confidence in federal agencies.

The cryptocurrency industry faces regulatory abuses

The allegations focus on “Operation Chokepoint 2.0,” an alleged attempt to marginalize cryptocurrency companies by limiting their access to banking services. The initiative mirrors a controversial Obama-era program targeting firearms dealers and payday lenders. Industry advocates argue that this release focuses only on the cryptocurrency sector.

Loomis cooperated with Senator Tim Scott, Chairman of the Senate Banking Committee, to investigate the allegations. It criticized the FDIC’s alleged bad faith practices, noting its refusal to fully cooperate in court-ordered disclosures. Coinbase has filed a lawsuit against the FDIC over redacted documents, including a directive to temporarily halt cryptocurrency-related activities.

Pro-crypto voices like attorney John Deaton have called these measures regulatory overreach. Deaton warned of unchecked bureaucratic power and the erosion of institutional integrity. The cryptocurrency industry continues to push for accountability and fair treatment by regulators.

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