Pro-Crypto Congressman French Hill To Chair House Financial Services Committee

An increasing number of pro-crypto officials are being elevated to senior positions as the Trump administration prepares to take office.

On Dec. 12, Republican Congressman French Hill, the chairman of the House Subcommittee on Digital Assets, was chosen to chair the House Financial Services Committee once Patrick McHenry, the current chairman, retires from Congress at the end of his term.

With Hill notably spearheading the Financial Innovation and Technology for the 21st Century Act (FIT21) — a bill seeking to establish clear regulations and consumer protections for the cryptocurrency industry — crypto proponents are bullish on Hill’s appointment.

McHenry, who has also spoken out against the U.S. Securities and Exchange Commission (SEC)’s unfair treatment of the crypto industry, congratulated Hill on his selection to lead the committee.

“From stepping in on my behalf multiple times to lead Committee Republicans, to spearheading the landmark FIT21, Congressman Hill has proven his capacity to lead this Committee,” McHenry said. “With French Hill at the helm, Republicans will build on our work from this Congress to finally enact a clear regulatory framework and robust consumer protections for the digital asset ecosystem.”

Eleanor Terrett of Fox Business reported that Hill is very pro-crypto. According to Terrett, Hill said Congress will review and investigate the web3 industry’s claim that regulators have sought to debank the crypto industry in the United States.

“I am humbled that my colleagues have placed their trust in me to lead the House Financial Services Committee as their next Chairman,” Hill said. “I look forward to working… in tandem with President Trump and Senate Banking Committee Chairman Tim Scott to bring common-sense economic policies that will produce a new era of American prosperity shared by all our citizens across our land."

The news follows Trump appointing David Sacks, a veteran Bitcoin and web3 investor, to the new position of White House AI & Crypto Czar, naming Paul Atkins, a former advisor to Reserve Protocol, as his preferred pick to head the Securities and Exchange Commission, and reports claiming that Brian Quintenz, the policy lead at a16z Crypto, is a front-runner to lead the Commodity Futures Trading Commission.

Operation Choke Point 2.0 faces pushback

Hill’s appointment comes as Operation Choke Point 2.0 (OCP2), the alleged U.S. regulatory campaign intended to debank the crypto industry, faces increasing pushback in the U.S.

The term OCP2 was coined by Nic Carter, the co-founder of Castle Island Ventures, in February 2023 in reference to Operation Choke Point — a U.S. Department of Justice program that sought to cut off access to banking services for industries believed to be at “high risk” of fostering illicit activity, including online gambling, pornography, and payday lenders, from 2013 through 2017.

A similar campaign targeting web3 has unfolded since late 2022, when regulators moved to severely limit the exposure of banks servicing digital assets firms to the crypto industry, effectively cutting off their primary sources of business.

Targets included Signature Bank — which announced it would halve deposits from crypto firms in December 2022 before shutting down four months later, Metropolitan Commercial Bank — which stopped servicing crypto firms in January 2023, Silvergate Bank — which began winding down operations in March 2023 and filed for bankruptcy in September, and Customers Bancor — which was targeted by a Federal Reserve enforcement action in August.

“Two years ago… the Fed quietly hammered five banks and thereby kicked off its industry-wide dragnet against banks serving the crypto industry,” tweeted Caitlin Long, the founder and CEO of Custodia Bank. Long said Custodia was one of the five banks whose crypto activities were abruptly targeted from Nov. 27, noting that the other four institutions either “no longer exist” or have “curtailed/exited their crypto banking activities since.

“There are too many stories of people being hurt by Operation Choke Point 2.0," David Sacks tweeted on Dec. 6. "It needs to be looked at."

Recently published email communications from 2022 between the U.S. Federal Deposit Insurance Corporation (FDIC) appear to evidence the alleged OCP2 clampdown.

“We respectfully ask that you pause all crypto asset-related activity," the FDIC said to an unnamed financial institution. "The FDIC will notify all FDIC-supervised banks at a later date when a determination has been made on the supervisory expectations for engaging in crypto asset-related activity."