Caitlin Long, CEO of crypto bank Custodia, has criticized the US government for its handling of a massive crypto fraud that occurred months before the company’s collapse. She made the remarks in a blog post after disclosing evidence to law enforcement agencies; Long’s post came in the wake of Custodia’s failed application to become a member of the Federal Reserve System, which was denied by the Federal Reserve Board.
Custodia’s CEO criticized the U.S. government for “shooting the messenger who warned of crypto doom”
Executives of digital currency and blockchain companies are displeased with the U.S. government’s lack of policing and regulatory clarity. Coinbase CEO Brian Armstrong has called on Congress to pass clear legislation on cryptocurrencies, and Kraken CEO Jesse Powell echoes that message.On February 17,Caitlin Long,Custodia CEO Caitlin Long published a blog postexplaining that she had provided evidence to authorities about a crypto fraud case months before the company collapsed, leaving millions of its customers with lossesIn her blog post titled “
Shame on Washington, DC for Shooting a Messenger Who Warned of Crypto Debacle,” Long argues that the current enforcement action is a misguided crackdown on the entire industry. Long writes, “The calls for crackdowns today come from many of the same policymakers who were attracted to the scammers.” It is well known that officials from the U.S. Securities and Exchange Commission (SEC), the White House, and the Commodity Futures Trading Commission (CFTC) met with Sam Bankman-Fried (SBF) and FTX officials.
In addition, one in three members of Congress (estimated) have received direct contributions from SBF and its close associates (31). In a “180-degree turn, [policymakers] are now throwing the baby out with the bath water,” Long wrote in his blog, noting that Custodia’s CEO also likened the government authorities’ management of her crypto bank to the FTX scandal and collapse, which led to an ambush on the crypto industry by the authorities She also noted.
“Custodia Bank has recently found itself in the worst crosshairs of Beltway politics,” Long stressed. “Custodia was attacked simultaneously by the White House, the Federal Reserve, the Kansas City Fed, and Senator Dick Durbin (who confused our non-leveraged, 100% liquid and solvent bank with the FTXin his Senate floor speechIn his Senate floor speechhe attacked two companies run by female CEOs, Fidelity and Custodia, and implicitly compared us to a 29-year-old accused fraudster who now wears an ankle bracelet).”
Custodia’s CEO added:
Custodia tried to get federal regulation – th
