a16z: Where Did the U.S. Government's Crypto Crackdown Come From? Which Agencies Are Involved?
Original Article Title: Debanking: What you need to know
Original Source: a16z crypto
Original Translation: 0xjs@, Golden Finance
a16z Co-Founder Marc Andreessen revealed on the November 28 Joe Rogan podcast that 30 tech founders had their bank accounts closed by US banks due to their involvement with crypto. In response, on December 6, a16z crypto published an op-ed discussing "Debanking: What you need to know." The translation by 0xjs@ Golden Finance is as follows:
「Debanking」 has been happening behind the scenes for years but has now become a public discussion topic once again. Many individuals, policymakers, companies, and the most important entrepreneurs for US innovation have spoken out on this issue. As the cryptocurrency industry and specific institutions have repeatedly appeared in this discussion, here is a brief explanation of this phenomenon to help distinguish signal from noise.
But first, what is 「debanking」?
In essence, debanking refers to law-abiding individuals or entities unexpectedly losing their banking relationships, or even being kicked out of the banking system.
Debanking is different from a situation where an entity loses banking services due to being suspected or confirmed of engaging in fraud, money laundering, or other illegal activities.
Debanking can occur without any apparent investigation, detailed explanation, or prior notice, without giving the entity enough time to transfer funds. Most importantly: there is no due process, appeal process, or other recourse.
Why is this important?
We have established fair banking rules, attempting to ensure that people are not discriminated against based on age, gender, marital status, nationality, race, religion, etc. However, these rules do not restrict banks (or their regulators) from arbitrarily denying or revoking someone's banking service rights.
Thus, debanking can be used by specific political actors/institutions as a tool or weapon, systematically employed without due process to target individuals or industries. Imagine if the government decided who could or could not access electricity solely based on political stance or some arbitrary reason... without explanation, investigation, notice, or providing remedies. Debanking is precisely that kind of scenario.
Why Debanking?
Not all bank closures are considered "debanking." Banks can close a customer's account for various reasons, including if they believe the customer is engaged in suspicious activities. Banks may also choose to proactively reduce regulatory compliance costs and workload by limiting exposure to certain individuals, industries, or business models.
However, it is not this legitimate activity that has raised concerns about debanking. Instead, many debanking concerns stem from reports of regulatory agencies abusing their power, pressuring banks to cancel customers in certain industries or those associated with political factions or interests disliked by the political establishment. This allows these regulatory agencies to wield power over industries, even though Congress has never authorized such power.
Banks often acquiesce to this pressure as they do not wish to conflict with regulators. Many banks also do not wish to deal with compliance issues, meaning additional scrutiny imposed by bank regulators for non-compliance.
Where Did "Operation Choke Point" Come From?
In 2013, the U.S. Department of Justice was found to have initiated an investigation into fraud and money laundering by certain businesses, a policy move of the President's Financial Fraud Enforcement Task Force. This marked a shift in government strategy: instead of targeting individual companies' wrongdoing, the government issued subpoenas to banks and payment processors requesting information on their customers engaged in high-risk or politically unfavorable yet legal businesses.
In other words, the government was using regulatory power unjustly to "choke off" financial service channels and close accounts, with the aim of stifling enterprises in industries the government did not favor (as observed by leaders of the American Bankers Association and the Financial Services Roundtable at the time). In 2014, Frank Keating (former President and CEO of the American Bankers Association, former Governor of Oklahoma, and Honorary Chairman of the Bipartisan Policy Center) pointed out in a column in The Wall Street Journal:
"When you become a banker, no one pins a badge on you, nor do you don a judicial robe. So why is the Justice Department telling bankers to act like cops and judges? The Justice Department's new investigation, called 'Operation Choke Point,' demands that banks identify customers who might be breaking the law or just doing things that government officials don't like."
Due to strong opposition from the law, Congress, and institutions, the program was shut down the following year.
Today, the phrase 「Operation Choke Point 2.0」 is sometimes used to refer to the government cutting off banking services to "political enemies and unwelcome tech startups." Or in other words, this term refers to banks "severing relationships with customers deemed politically incorrect, extreme, dangerous, or overstepping." However defined, the term represents an issue affecting both ends of the political spectrum and entities across the political spectrum.
Which Institutions are Involved?
The inner workings of "Choke Point" — as well as any other related or subsequent systemic efforts aimed at depriving specific entities or industries of banking services — were previously unknown, as any investigations (if conducted) were carried out behind closed doors, and Freedom of Information Act requests were pending. However, on December 6, a court filing in such a FOIA case revealed that the Federal Deposit Insurance Corporation (FDIC) instructed at least one bank (in a letter dated March 11, 2022): "…the FDIC has not yet determined what regulatory paperwork banks engaging in such activities would need, if any. As a result, we respectfully request that you cease all activities related to digital assets." Numerous FDIC letters were submitted as appendices to the filing.
At the same time, it is already known that the original Financial Fraud Enforcement Task Force that implemented "Operation Choke Point 1.0" in 2013 included the Federal Deposit Insurance Corporation (FDIC) and the Department of Justice (DOJ) among others. The Office of the Comptroller of the Currency (OCC) — an independent bureau under the U.S. Department of the Treasury — also appears to have been involved, along with the U.S. central bank — the Federal Reserve Board (FRB). The Consumer Financial Protection Bureau (CFPB) is also mentioned.
Note: The U.S. government is not the only country to implement debanking policies. Other countries, such as Canada, have also employed such strategies; the UK has also had to investigate complaints about government-led debanking policies.
Why is the Government Doing This? What are the Effects?
Debanking is motivated by various reasons, from combating fraud by payment processors to preventing high-risk businesses from operating, as these businesses may be seen as having more links to money laundering. These reasons are often referred to as "de-risking" rather than "debanking": "Financial institutions terminating or restricting business relationships with broad categories of customers without individually assessing and managing the risks posed by those customers."
In a broader sense, de-risking and debanking can serve as a "partisan tool," choking off legitimate businesses solely for political reasons. Another reason may be that certain government entities wish to have more discretion and power in deciding "where consumers can access loans, financial products, and other banking services and under what circumstances."
It is important to note that the issue does not lie in the performance of a specific government entity's duties. The issue lies in the government's excessive interference with legitimate businesses (or general abuse of power)—with no meaningful due process and no ability to constrain its actions, often carried out behind the scenes. Particularly because there are already enough laws and legal means to regulate businesses for legitimate reasons, such as providing consumer protection, preventing money laundering, and stopping other criminal activities.
The use of debanking strategies can lead to many unforeseen consequences. Even if the aim is truly to protect consumers and the banking system, the results may backfire, hindering consumer choice or causing a chilling effect on the entire industry. These practices also undermine the U.S. government's own policy objectives, as highlighted in the U.S. Department of the Treasury's Report on De-Risking (2023):
· Excluding financial activities from the regulated financial system;
· Obstructing remittances or delaying the smooth transfer of international development funds and humanitarian/disaster relief funds;
· Impeding the effective use of the financial system by low- to middle-income groups and other underserved populations;
· Undermining the central position of the U.S. financial system.
Ultimately, employing a "debanking" strategy could inadvertently punish legitimate businesses and individuals through association. For example, someone may have their previously approved mortgage loan revoked simply because they work for an open-source foundation in the cryptocurrency industry.
For all the reasons mentioned above, many consider the practice of debanking to be "un-American." When debanking indiscriminately targets emerging technologies, it is undoubtedly anti-innovative.
How Widespread Is Debanking?
While we cannot speak for the entire industry or specific interests, as venture capitalists in the cryptocurrency industry, we have witnessed firsthand at least 30 debanking cases occurring in our portfolio companies and founders over the past four years. Coinbase has also publicly stated that they have identified at least "20 instances where the FDIC has requested that a bank 'pause,' 'stop providing,' or 'not continue' providing cryptocurrency banking services."
There may be more cases like this. Due to many entrepreneurs and small businesses being concerned about further retaliation or lacking resources to address the issue, they have been hesitant to come forward, and thus the issue has gone unreported.
For companies in our portfolio, many instances of debanking have occurred with companies that are pre-revenue and pre-token issuance. Their bank accounts have received venture capital funding (provided through institutions like pension funds and university endowments), with these companies using the funds for employee salaries and regular business expenses—just like any other tech startup.
So, what reasons have these companies been given? Whether written or (more commonly) verbal? The stated reasons include "We do not offer cryptocurrency banking services," and more commonly: "Your account has been closed due to compliance-related issues. Please withdraw all funds immediately." These companies have also been informed of this, but have not received specific information on which exact "compliance" issue, nor can they remedy it if one does exist. Finally, other reports we have received from companies include:
· Being informed that "the business compliance back-office team closed the account and prevented us from opening any other account. No other reasons given, and no appeals process provided";
· Being rejected due to "a lack of trust in anyone operating a crypto company";
· Receiving baseless inquiries and notices, bringing costly cycles and undue stress to the startup—already operating lean compared to large companies.
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On March 16, 2026, in Dallas, Texas, USA, CanGu Company (New York Stock Exchange code: CANG, hereinafter referred to as "CanGu" or the "Company") today announced its unaudited financial performance for the fourth quarter and full year ended December 31, 2025. As a btc-42">bitcoin mining enterprise relying on a globally operated layout and dedicated to building an integrated energy and AI computing power platform, CanGu is actively advancing its business transformation and infrastructure development.
• Financial Performance:
Total revenue for the full year 2025 was $688.1 million, with $179.5 million in the fourth quarter.
Bitcoin mining business revenue for the full year was $675.5 million, with $172.4 million in the fourth quarter.
Full-year adjusted EBITDA was $24.5 million, while the fourth quarter was -$156.3 million.
• Mining Operations and Costs:
A total of 6,594.6 bitcoins were mined throughout the year, averaging 18.07 bitcoins per day; of which 1,718.3 bitcoins were mined in the fourth quarter, averaging 18.68 bitcoins per day.
The average mining cost for the full year (excluding miner depreciation) was $79,707 per bitcoin, and for the fourth quarter, it was $84,552;
The all-in sustaining costs were $97,272 and $106,251 per bitcoin, respectively.
As of the end of December 2025, the company has cumulatively produced 7,528.4 bitcoins since entering the bitcoin mining business.
• Strategic Progress:
The company has completed the termination of the American Depositary Receipt (ADR) program and transitioned to a direct listing on the NYSE to enhance information transparency and align with its strategic direction, with a long-term goal of expanding its investor base.
CEO Paul Yu stated: "2025 marked the company's first full year as a bitcoin mining enterprise, characterized by rapid execution and structural reshaping. We completed a comprehensive adjustment of our asset system and established a globally distributed mining network. Additionally, the company introduced a new management team, further strengthening our capabilities and competitive advantage in the digital asset and energy infrastructure space. The completion of the NYSE direct listing and USD pricing also signifies our transformation into a global AI infrastructure company."
"As we enter 2026, the company will continue to optimize its balance sheet structure and enhance operational efficiency and cost resilience through adjustments to the miner portfolio. At the same time, we are advancing our strategic transformation into an AI infrastructure provider. Leveraging EcoHash, we will utilize our capabilities in scalable computing power and energy networks to provide cost-effective AI inference solutions. The relevant site transformations and product development are progressing simultaneously, and the company is well-positioned to sustain its execution in the new phase."
The company's Chief Financial Officer, Michael Zhang, stated: "By 2025, the company is expected to achieve significant revenue growth through its scaled mining operations. Despite recording a net loss of $452.8 million from ongoing operations, mainly due to one-time transformation costs and market-driven fair value adjustments, the company, from a financial perspective, will reduce its leverage, optimize its Bitcoin reserve strategy and liquidity management, introduce new capital to strengthen its financial position, and seize investment opportunities in high-potential areas such as AI infrastructure while navigating market volatility."
The total revenue for the fourth quarter was $1.795 billion. Of this, the Bitcoin mining business contributed $1.724 billion in revenue, generating 1,718.3 Bitcoins during the quarter. Revenue from the international automobile trading business was $4.8 million.
The total operating costs and expenses for the fourth quarter amounted to $4.56 billion, primarily attributed to expenses related to the Bitcoin mining business, as well as impairment of mining machines and fair value losses on Bitcoin collateral receivables.
This includes:
· Cost of Revenue (excluding depreciation): $1.553 billion
· Cost of Revenue (depreciation): $38.1 million
· Operating Expenses: $9.9 million (including related-party expenses of $1.1 million)
· Mining Machine Impairment Loss: $81.4 million
· Fair Value Loss on Bitcoin Collateral Receivables: $171.4 million
The operating loss for the fourth quarter was $276.6 million, a significant increase from a loss of $0.7 million in the same period of 2024, primarily due to the downward trend in Bitcoin prices.
The net loss from ongoing operations was $285 million, compared to a net profit of $2.4 million in the same period last year.
The adjusted EBITDA was -$156.3 million, compared to $2.4 million in the same period last year.
The total revenue for the full year was $6.881 billion. Of this, the revenue from the Bitcoin mining business was $6.755 billion, with a total output of 6,594.6 Bitcoins for the year. Revenue from the international automobile trading business was $9.8 million.
The total annual operating costs and expenses amount to $1.1 billion.
Specifically, they include:
· Revenue Cost (excluding depreciation): $543.3 million
· Revenue Cost (depreciation): $116.6 million
· Operating Expenses: $28.9 million (including related-party expenses of $1.1 million)
· Miner Impairment Loss: $338.3 million
· Bitcoin Collateral Receivable Fair Value Change Loss: $96.5 million
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The 2025 non-GAAP adjusted net profit is $24.5 million (compared to $5.7 million in 2024). This measure does not include share-based compensation expenses; refer to "Use of Non-GAAP Financial Measures" for details.
As of December 31, 2025, the company's key assets and liabilities are as follows:
· Cash and Cash Equivalents: $41.2 million
· Bitcoin Collateral Receivable (Non-current, related party): $663.0 million
· Miner Net Value: $248.7 million
· Long-Term Debt (related party): $557.6 million
In February 2026, the company sold 4,451 bitcoins and repaid a portion of related-party long-term debt to reduce financial leverage and optimize the asset-liability structure.
As per the stock repurchase plan disclosed on March 13, 2025, as of December 31, 2025, the company had repurchased a total of 890,155 shares of Class A common stock for approximately $1.2 million.

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