In recent developments, former US President Donald Trump is reportedly preparing an executive order aimed at scrutinizing banks that have allegedly discriminated against customers based on political affiliations or involvement in cryptocurrency. This initiative is expected to gain momentum with an official announcement imminent.

Understanding the Banking-Crypto Conflict

For years, cryptocurrency businesses have reported feeling marginalized by major financial institutions. Critics argue that during the Biden administration, initiatives like “Operation Chokepoint 2.0” led to abrupt account closures without transparent explanations. In a significant revelation, Coinbase CEO Brian Armstrong disclosed in 2023 that JPMorgan Chase had threatened to terminate accounts linked to cryptocurrency earnings. By the following year, tech mogul Elon Musk highlighted that approximately 30 tech entrepreneurs had experienced similar account closures.

Trump’s Stance on Removing ‘Reputational Risk’ Justifications

The proposed executive order, as detailed by The Wall Street Journal, intends to instruct federal banking regulators to investigate potential violations of critical laws, including the Equal Credit Opportunity Act, antitrust regulations, and consumer protection laws. Banks found culpable may face substantial fines or enforced compliance measures. The overarching goal is to prevent banks from using compliance as a pretext for political bias.

Potential Penalties and Regulatory Actions

According to a Reuters report, the executive order could be implemented shortly, equipping regulators with the authority to impose fines and other disciplinary measures. Additionally, it mandates the Small Business Administration to evaluate banks involved in guaranteeing SBA loans, potentially subjecting lenders accused of discriminatory practices to increased scrutiny.

Political Dimensions of Banking Decisions

Former President Trump has vocally criticized major banks, asserting that executives from institutions like JPMorgan Chase and Bank of America have excluded conservative clients. While these banks have refuted such allegations, the discourse has intensified as Republican figures and state officials denounce what they term “woke capitalism,” accusing banks of severing ties with gun manufacturers, fossil fuel companies, and other right-leaning enterprises. These discussions have significantly influenced the focus of the executive order.

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