Cynthia Lummis Opposes Returning to Chokepoint 2.0

US Senator Cynthia Lummis stated that America "must never return to the Chokepoint 2.0 era," characterizing the Biden administration's regulatory pressure on the crypto industry and banking access as a policy path that suppresses innovation.

"Chokepoint 2.0" is not an official project name of the US government, but rather a political label used by the crypto industry and some Republican lawmakers to describe a type of regulatory phenomenon: banking regulators, law enforcement agencies, or prudential regulatory pressure that makes it harder for banks to provide accounts, payment, custody, settlement, and credit services to crypto companies.

This term borrows from the historical name "Operation Choke Point," which was an anti-fraud initiative promoted by the US Department of Justice during the Obama administration, focusing on payment processing and categories of merchants deemed high-risk; the "2.0" narrative in the crypto industry points to the situation where digital asset companies are de-risked, have their accounts closed, or face a reduction in services by banks.

Lummis's remarks were in response to Trump's criticism of crypto regulation during the Biden administration. Reports quoted Trump as saying that the policies constituted a "brutal attack" on the crypto industry, causing innovation to flow out and benefiting China; this reflects a political stance rather than independent causal proof of policy effects.

For crypto companies, banking channels are the infrastructure for fiat currency inflows and outflows, customer fund segregation, payroll, taxation, transaction clearing, and stablecoin reserve management. Even if on-chain protocols can continue to operate, if companies cannot consistently obtain compliant bank accounts, their trading, custody, issuance, market-making, and payment operations will still be significantly restricted.

In market mechanisms, crypto exchanges, stablecoin issuers, custodians, mining companies, and payment firms are the buyers of stable banking services; commercial banks, payment institutions, compliance technology companies, and audit service providers are the suppliers. If the political and regulatory environment shifts to support banks serving crypto clients under controlled risk conditions, compliant custody, payment, stablecoin settlement, and trading infrastructure will benefit; existing financial intermediaries relying on regulatory uncertainty to maintain competitive barriers, as well as high-leverage crypto businesses with inadequate risk control, will face repricing.

Source: Public Information