- U.S. banks, led by JPMorgan, allegedly impose “Chokepoint 3.0.”
- Banks aim to restrict fintech by elevating transaction fees.
- Potential impacts on crypto markets and fintech startups.
Major U.S. banks, spearheaded by JPMorgan Chase, are reportedly enacting ‘Chokepoint 3.0,’ imposing higher fees and account restrictions on the crypto sector, according to a16z’s Alex Rampell.
The move, likened to previous regulatory crackdowns, poses significant barriers to crypto market access and competition, potentially impacting user adoption and market dynamics.
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Major U.S. banks are reportedly orchestrating “Chokepoint 3.0” to limit crypto and fintech access.
Allegations by a16z’s Alex Rampell cite increased fees as a key tactic. Previous regulatory crackdowns lacked such direct bank involvement. Reports from a16z claim banks, especially JPMorgan Chase, are inflating fees to stifle competition. Rampell has highlighted the issue, emphasizing that it’s not a mere revenue strategy but rather aimed at limiting fintech growth.
The purported tactics could hinder consumer access to crypto and fintech services.
Higher transfer fees may discourage users from linking their bank accounts to crypto platforms like Coinbase, according to Rampell’s statements. The financial implications involve potentially reduced capital inflow into crypto exchanges. Market insiders warn of strained crypto startups, risking diminished innovation and competitiveness in the sector.
Historical parallels to “Operation Chokepoint” suggest regulatory strategies affecting high-risk industries, including crypto.
In previous contexts, banks deprived certain sectors of critical financial services. The potential outcomes hint at increased barriers for crypto asset transfers and fintech growth. Rampell warns of escalated transaction costs akin to “high-risk” industry treatment seen previously, indicating substantial sector disruption.
JPMorganChase is an $800 billion company. Make no mistake: this isn’t about a new revenue stream. It’s about strangling competition. And if they get away with this, every bank will follow. – Alex Rampell, General Partner, a16z source
