Warning for the Crypto Sector
In a significant warning for the crypto sector, Andreessen Horowitz (a16z), a major player in venture capital, suggests that banks may be gearing up for a renewed effort to restrict access to the cryptocurrency industry. In the most recent edition of their Fintech Newsletter, Alex Rampell, a general partner at a16z, highlighted a potential “Chokepoint 3.0.” This term alludes to a continuation of prior government measures dubbed Operation Chokepoint 2.0, which aimed at undermining crypto enterprises.
Concerns Over Banking Policies
Rampell’s concerns were sparked by JPMorgan Chase’s recent policy change that imposes steep fees for crypto and fintech companies seeking basic customer data—such as routing numbers and account details. He describes these charges as “insanely high” and argues that their primary intention is to eliminate competition rather than create additional profit avenues.
“JPMorgan Chase is an $800 billion institution. This isn’t about finding new revenue. It’s about choking competition. If they succeed, other banks will certainly emulate this strategy.”
Rampell points out the irony that essential banking information, which is typically readily available on checks, is now subject to exorbitant fees when provided electronically—even though these banks were rescued with taxpayer money just 17 years ago.
Implications for Consumers
The implication is clear: if it’s going to cost a consumer $10 to deposit $100 into platforms like Coinbase or Robinhood, many may think twice about such transactions. Similarly, charging $10 for accessing a lower interest loan from a fintech firm could push consumers toward less favorable offers from banks like JPMorgan. Should these banks restrict customers’ ability to link their own preferred crypto and fintech services to their accounts, they could significantly curtail competition in the financial landscape.
