Bitcoin payment company kicked out by major banks, crypto industry warns of increasing risks of financial joint liability laws

The US cryptocurrency industry is once again facing a tense situation. Morgan Stanley recently unilaterally closed the bank account of Jack Mallers, CEO of Bitcoin payment platform Strike. This move not only targeted individuals but also raised industry concerns about the underlying use of the “guilt by association” mechanism in financial regulation.

Major Banks Take Action, Reasons Remain a Mystery

According to Mallers’ disclosure on social media, Morgan Stanley unexpectedly closed his personal account last month. What’s more confusing is that this global top-tier investment bank refused to explain the reason. Mallers stated that every time he inquired, he was told the same thing: “We are unable to disclose the reason to you.”

Behind this approach lies the logic of “guilt by association” in US financial regulation—using sanctions against a single individual to exert pressure on the entire industry. Once a key figure is “cut off,” the flow of funds and business expansion within the ecosystem can be severely hindered.

“Operation Chokepoint 2.0” Returns, Risks of De-Banking Highlighted

This incident immediately sparked industry concerns about “Operation Chokepoint 2.0”—a concept referring to the government working with financial institutions to systematically cut off banking services to crypto companies, effectively creating a de facto industry ban.

US Senator Cynthia Lummis promptly issued a warning in a public setting, pointing out that this guilt-by-association style financial suppression is unfolding. She emphasized that the actions of major banks like Morgan Stanley are eroding public trust in the traditional banking system and pushing the crypto industry overseas. Lummis called for the US to become a global hub for digital asset innovation rather than a capital outflow destination.

De-banking is no longer a hypothetical threat but a reality faced daily by crypto practitioners. When financial institutions use guilt-by-association tactics against individual entrepreneurs, the costs of financing, operations, and compliance for the entire industry increase accordingly.

Industry’s Future Path

Strike, as a leading application supporting Bitcoin Lightning Network payments, having its CEO’s account shut down symbolizes that even compliant crypto company executives are not immune to regulatory and financial sector “chilling effects.” This, in turn, accelerates the demand for decentralized finance (DeFi) and peer-to-peer payment solutions.

The real dilemma facing the crypto industry is that under the current regulatory framework, financial institutions can impose guilt-by-association style punishments without clear reasons. This is precisely the core obstacle that the industry needs to break through—“financial barriers.”