Custodia Bank CEO Caitlin Long criticized regulators and lawmakers in Washington DC for their “misguided crackdown” on the cryptocurrency sector, and also for ignoring her warnings about major “fraud” allegedly being carried out by entities now in bankruptcy.
In a blog on February 17 mail Titled “Shame on Washington, DC for Shooting Courier Who Warned About Crypto Debacle,” Long criticized the government for its approach to crypto regulation, failing to protect investors and alienating good players in the space:
“Washington’s misguided crackdown will only push risks into the shadows, leaving regulators to play hit-a-mole as risks continually pop up in unexpected places.”
Long emphasized that with her digital asset custody firm, she “has been exposing the worst of crypto while trying to build a legal and compliant alternative that consigns scams to the dustbin. But […] most legislators today seem intent on killing high-integrity innovators.”
The Custodia Bank CEO said her efforts to work with government agencies eventually fell apart as she recounted the series of negative confrontations her company has had lately.
“Custodia was simultaneously attacked by the White House, the Federal Reserve Board of Governors, the Kansas City Federal Reserve and Senator Dick Durbin (who conflated our 100% liquid and solvent unleveraged bank with FTX in a Senate speech )”, she said, adding that:
“Custody tried to be regulated by the federal government, the same result that bipartisan politicians claim to want. Yet Custody has been denied and now belittled for daring to walk through the front door.”
His sentiments are echoed by figures like Coinbase CEO Brian Armstrong, who has suggested on multiple occasions that agencies like the Securities and Exchange Commission (SEC) have reacted coldly to his company’s efforts to maintain good-natured dialogue. faith.
Earlier this month, Armstrong also criticized a lack of regulatory clarity in the US and what appears to be a “rule by enforcement” approach following the SEC’s decision to shut down Kraken’s staking services on September 9. February.
“Today’s regulators and legislators in Washington are no doubt embarrassed that they failed to stop cryptocurrency criminals. DC is demanding scalps,” Long wrote in the blog post, adding that:
“Calls to crack down today are coming from many of the same policymakers who were charmed by the scammers. In a 180 degree turn, they are now flushing the baby out with the bathwater.”
neglected warnings
On Twitter, Long also suggested that long before the implosion of several crypto companies in 2022, she and many others had tried to warn Washington and “help law enforcement stop” major fraud, but to no avail.
Related: SEC vs. Kraken: A Single or Opening Salvo in an Assault on Crypto?
Long stated that he was publicly disclosing for the first time that he had “provided evidence to law enforcement of probable crimes” committed by an unidentified crypto company “months before the company imploded and caused losses to its millions of customers.”
1/ IT’S TIME FOR ME TO REVEAL SOME THINGS. I just published a post “Shame on Washington, DC for shooting a courier who warned about #Crypto Debacle.” The link to the post is here:https://t.co/yTWWrEk3Os pic.twitter.com/rbo21DzOv3
— Caitlin Long ⚡️ (@CaitlinLong_) February 17, 2023
Kraken co-founder and CEO Jesse Powell responded to Long’s Twitter thread, essentially corroborating his statements by noting that: “I can’t tell you how infuriating it is to have flagged massive red flags and obviously illegal activity to the regulators only to have them ignore the problems for years.”
I can’t tell you how infuriating it is to have flagged massive red flags and obviously illegal activity to regulators only to have them ignore the issues for years. “They’re offshore. It’s complicated. We’re looking at everyone.” DURING YEARS. So to be used as your example. https://t.co/YHdNazM2UE
—Jesse Powell (@jespow) February 18, 2023
