Pro-Bitcoin Senator Accuses FDIC Of Sabotaging Digital Asset Documentation

In a significant development for the ongoing discourse surrounding the digital asset sector, US Senator Cynthia Lummis (R-WY) has raised serious allegations against the Federal Deposit Insurance Corporation (FDIC). 

In a letter directed to FDIC Chair Marty Gruenberg, Lummis claims whistleblowers from within the agency have reported efforts to destroy documentation related to the FDIC’s digital asset activities. The senator’s letter demands an immediate cessation of these alleged actions in anticipation of Congressional oversight.

FDIC Staff Threatened Over Digital Asset Oversight

Senator Lummis has positioned herself as a strong advocate for Bitcoin (BTC) and other cryptocurrencies, and her concerns about the FDIC come amid heightened scrutiny of the agency’s handling of digital assets. 

In her letter, she emphasizes the gravity of the allegations, stating, “The FDIC’s alleged efforts to destroy and conceal materials from the US Senate related to Operation Chokepoint 2.0 is not only unacceptable, it is illegal.” 

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For context, operation Chokepoint 2.0 refers to a controversial initiative aimed at regulating financial institutions that engage with certain “high-risk industries,” including the digital asset sector.

Lummis’s correspondence outlines specific claims made by whistleblowers who allege that FDIC staff members have faced threats of legal action to discourage them from disclosing information to the Senate. 

She asserts that management has been closely monitoring access to documents to prevent potential leaks before any materials can be destroyed. This alleged behavior, if proven true, violates the principles of transparency that the American public deserves, the Senator stated.

‘Documentation Must Be Secured And Preserved’

In her letter, Lummis explicitly instructs Chair Gruenberg to ensure that all destruction of materials ceases immediately and that all existing documentation related to the FDIC’s digital asset activities since January 1, 2022, is preserved.

The senator defines “digital asset activities” broadly, encompassing a range of topics, including the supervision and resolution of banks involved in the crypto sector—specifically Signature Bank and Silvergate Bank—as well as the development of rules and policies governing digital assets.

Lummis further underscores the importance of retaining any materials containing terms associated with digital assets, such as “crypto,” “cryptocurrency,” “Bitcoin,” and “Ethereum.” 

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She makes it clear that any classification of these documents as confidential or privileged does not exempt them from the Senate’s oversight powers, insisting that the FDIC must take all necessary steps to secure and maintain the integrity of these records.

The senator warns that if evidence emerges indicating that FDIC staff have knowingly destroyed materials or obstructed Senate oversight, she will not hesitate to refer the matter to the US Department of Justice (DOJ) for criminal investigation. 

At the time of writing, the market’s leading cryptocurrency, Bitcoin, is once again trading above the $101,000 mark, up nearly 8% on a weekly basis. 

Featured image from DALL-E, chart from TradingView.com