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Lawmakers are investigating claims that government regulators have pressured banks to sever ties with cryptocurrency businesses, Representative French Hill, R-Ark., announced during a House Financial Services Committee hearing. This bipartisan initiative reflects growing concerns about the alleged exclusion of legal crypto firms from traditional banking.

At the hearing, Hill vowed to prioritize the probe, emphasizing that Congress lacks "patience" for regulators sidelining legitimate industries. Crypto executives testified to sudden account closures and other banking hurdles, citing regulators' alleged informal directives to avoid a paper trail.

Denelle Dixon, CEO of the Stellar Development Foundation, shared that her nonprofit was forced to approach multiple banks after one abruptly ended their six-year relationship without explanation. Similarly, Nathan McCauley, CEO of Anchorage Digital Bank, reported being dropped by a banking provider following a joint federal statement highlighting risks associated with crypto in early 2023.

Lawmakers likened the situation to past regulatory efforts under the Obama administration that targeted industries like firearms and payday lending, a controversy underscored by a damning paper trail. Hill voiced concerns that spoken guidance from regulators might intentionally bypass documentation, complicating accountability.

While the hearing also touched on technology's role in financial innovation, including AI guardrails and data privacy, much of the focus was on crypto. Lawmakers celebrated retiring Chair Patrick McHenry, R-N.C., for his bipartisan leadership and commitment to advancing cryptocurrency legislation.

This investigation signals a robust congressional effort to safeguard fair access to banking for emerging financial technologies while balancing regulatory oversight.