Regulatory tightening impacts the Crypto industry; Republicans criticize Biden's "financial isolation" policy

2025-12-16 16:13:35

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The Republican camp in the United States has recently launched fierce criticism against the previous administration’s crypto regulation policies. The House Committee on Financial Services and the Oversight Subcommittee issued a final report, directly pointing to the Biden administration’s implementation of de facto financial segregation in the digital asset industry.

Regulatory Agencies’ “Three-Pronged” Approach to Suppress Crypto Companies

The report reveals that Biden’s regulatory agencies have used multiple measures to restrict cooperation between banks and digital asset-related entities. Specifically: the FDIC has intensively sent “suspension” letters, the OCC has increased regulatory burdens on digital asset businesses, and the SEC has relied on enforcement actions to target crypto companies. These measures indirectly force financial institutions to proactively distance themselves from crypto clients, resulting in at least 30 institutions and individuals involved in digital asset activities being unable to access normal financial services.

The report accuses regulators of creating a de facto “de-banking” policy system through vague rule interpretations, opaque discretionary authority, and informal guidance documents.

CLARITY Act Signals Policy Shift

To reverse the current situation, the Republican Party is pushing forward the legislative process of the “Digital Asset Market Structure Act” (CLARITY Act). The bill has already passed the House and is currently under review by the Senate Agriculture Committee and the Banking Committee, both led by Republicans. Senate Banking Committee Chairman Tim Scott stated that he plans to complete the bill review and submit it for signing by early 2026.

Trump Administration Begins to Reverse Policy Direction

Since President Donald Trump took office in January, he has signed a series of executive orders to reduce or eliminate several restrictive regulations on the crypto industry. This marks a significant shift in federal regulatory attitude, contrasting sharply with the previous administration’s “financial segregation” policies.

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