President Donald Trump has signed an executive order aimed at ending what the administration calls “politically motivated debanking” a practice that has impacted Bitcoin and other lawful businesses. The order directs regulators to remove subjective risk factors from bank oversight, investigate past debanking cases, and develop a strategy to prevent future discrimination. Reuters reported that it also requires agencies to refer potential violations to the Department of Justice within 120 days.
SBA oversight over traditional regulators
Custodia Bank founder Caitlin Long highlighted a major structural change in the order giving the Small Business Administration (SBA) an oversight role above the FDIC, Federal Reserve, and OCC. Bitcoin analytics and news platform Bitbo noted that Long sees this as a reflection of distrust toward traditional banking regulators’ willingness to address politically motivated debanking, especially against Bitcoin firms.
Trump appointed Kelly Loeffler, former U.S. senator and ex-CEO of institutional Bitcoin platform Bakkt, to head the SBA. Bitbo reported that Long views this as a clear signal that the administration is serious about changing how regulators treat Bitcoin and other lawful crypto companies. CryptoSlate also highlighted Loeffler’s appointment as a move likely to be welcomed by the Bitcoin community.
Bitbo further reported Long’s comments on political leanings within agencies like the Fed and FDIC, noting that as much as 92% of staff donations in recent elections went to Democratic candidates a trend she believes may have influenced partisan enforcement of debanking policies in the past.
Broad protection for lawful businesses
While the order does not name Bitcoin specifically, it prohibits “politicized or unlawful debanking” of any lawful business activity. Long told Bitbo that this means banks that previously refused to serve Bitcoin companies could now be held accountable, stating:
“Banks that refused to serve or debanked lawful bitcoin companies are on the hook.”
Speaking to Bitbo, Long said the true measure of success will be whether banks reinstate accounts for previously debanked firms like Custodia, adding:
“If they reinstate us, then the EO succeeded.”