Operation Choke Point 2.0 and How InvestGlass CRM Offers a Solution for Crypto Brokers
A deep dive into the impact of Operation Choke Point 2.0 on the crypto industry and how InvestGlass CRM is providing a way out for brokers
The cryptocurrency industry has been subject to increasing scrutiny from regulators and federal agencies, particularly with the introduction of Operation Choke Point 2.0, a program led by the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve System, and other agencies. This initiative has caused major disruptions within the banking system, impacting crypto asset-related activities and forcing many crypto firms to seek alternative banking solutions. In this article, we will discuss the implications of Operation Choke Point 2.0 for the crypto industry, the role of banks like Silicon Valley Bank and Signature Bank, and how InvestGlass CRM is providing a solution for crypto brokers.
Operation Choke Point 2.0: Background and Implications
The original Operation Choke Point, launched during the Obama administration, aimed to mitigate the risks associated with payday lenders, undesirable industries, and other high-risk financial institutions. The initiative focused on promoting sound banking practices and ensuring financial stability by encouraging banks to cut ties with these businesses. The first Operation Choke Point, however, was criticized for lacking due process and unfairly targeting legal businesses.
Under the Biden administration, Operation Choke Point has been revived as Choke Point 2.0, targeting the cryptocurrency industry specifically. Citing concerns over money laundering, financial crimes, and the potential destabilizing effects of digital assets on traditional equity markets, federal regulators have pressured banks to scrutinize their relationships with cryptocurrency customers and businesses.
The Impact on Crypto Firms and Banks
As a result of Choke Point 2.0, many banks have been reluctant to provide banking services to crypto firms. In some cases, banks have closed the accounts of crypto companies, limiting their access to the banking sector. This has forced many crypto firms to seek alternative banking solutions, such as Silvergate Bank and Custodia Bank, which are more open to providing banking rails to the cryptocurrency industry.
Some high-profile examples of banks closing accounts for cryptocurrency customers include Alameda Research and Celsius Network, both of which had their accounts closed by the Silicon Valley Bank. Similarly, Signature Bank has faced pressure from the FDIC and the Federal Reserve to cut ties with crypto firms.
InvestGlass CRM: A Solution for Crypto Brokers
Amid the challenges posed by Operation Choke Point 2.0, InvestGlass CRM offers a solution for crypto brokers seeking to maintain access to banking services and ensure the safety and security of their clients’ assets. InvestGlass CRM provides a comprehensive customer relationship management platform that enables brokers to navigate the complex regulatory landscape and adhere to anti-money laundering (AML) requirements.
InvestGlass CRM also allows crypto brokers to streamline their operations, manage client relationships, and access critical banking services through partnerships with financial institutions open to working with the cryptocurrency industry. This enables brokers to continue offering their services to institutional investors, even in the face of increasing regulatory pressure.
InvestGlass: A Swiss Neutral Solution
Established in Switzerland, InvestGlass operates under the hallmark of Swiss neutrality. Unlike companies under jurisdictions falling within the CLOUD Act, InvestGlass is exempt, ensuring a heightened level of data privacy for its users. It’s important to note that this Act, enacted by the U.S. government, mandates that U.S.-based tech companies must provide requested data stored on servers regardless of whether the data is stored in the U.S. or on foreign soil. InvestGlass’s neutral positioning, therefore, offers an extra layer of data security to its users.
Moreover, InvestGlass boasts integration with esteemed partners like Fireblocks and Sumsub, enhancing its utility and value for the crypto broker. Fireblocks is a renowned enterprise-grade platform delivering a secure infrastructure for moving, storing, and issuing digital assets. This partnership allows InvestGlass users to transact and store digital assets securely.
On the other hand, Sumsub is an identity verification platform that provides an all-in-one technical and legal toolkit to cover KYC/KYB/AML needs… removing bad actors and dodgy companies. This allows InvestGlass to ensure its users comply with the stringent anti-money laundering regulations and identity verification processes. Thus, InvestGlass, by being a Swiss neutral company, and through its partnerships with Fireblocks and Sumsub, provides a comprehensive, secure, and compliant platform for crypto brokers amidst the complexities of Operation Choke Point 2.0. InvestGlass offers a portfolio management tools fully compatible for cryptocurrency companies.
Operation Choke Point 2.0 has had a significant impact on the cryptocurrency industry, limiting access to banking services and forcing crypto firms to find alternative solutions. InvestGlass CRM offers a valuable solution for crypto brokers, enabling them to navigate the regulatory landscape, maintain access to banking services, and ensure the safety and security of their clients’ assets. As the crypto industry continues to evolve and adapt to the changing regulatory environment, solutions like InvestGlass CRM will play a crucial role in supporting its growth and resilience.