TL;DR

• President Trump is preparing to sign an executive order targeting banks that "debank" crypto firms and politically aligned businesses.
• The draft order would direct regulators to investigate whether laws like the Equal Credit Opportunity Act have been violated.
• Penalties may include fines, consent decrees, or referrals to the attorney general.
• The move is part of a broader response to what many have called "Operation Choke Point 2.0."
• If signed, the order could reshape the relationship between crypto and traditional banking institutions.

According to a recent Wall Street Journal report, President Donald Trump is preparing to sign an executive order designed to punish financial institutions accused of unfairly denying services - including to crypto companies and politically aligned individuals.

The executive order, still in draft form, would task financial regulators with investigating potential violations of federal law and authorizes disciplinary action against institutions found to be engaging in targeted debanking practices. While the exact timeline for the order remains unclear, the report notes it could be signed as early as this week. If enacted, it would mark one of the administration's most direct moves to support crypto during Trump's second term.

What's in the Draft Order?

The draft executive order reportedly contains several key provisions:

• Investigations into banks that may have violated the Equal Credit Opportunity Act, antitrust statutes, or consumer protection laws.
• Removal of internal bank policies that may have led to politically motivated debanking.
• A directive for the Small Business Administration (SBA) to review its loan partnerships to ensure fair access.
• Referrals of potential violations to the Attorney General for legal action.
• Restrictions on banks using "reputational risk" as a factor when denying or limiting services - a practice previously criticized for targeting legal but controversial industries like crypto.

Although the draft doesn't name specific banks or firms, it clearly signals a crackdown on what the Trump team views as politicized financial discrimination.

Operation Choke Point 2.0?

The crypto industry has long warned of what it calls "Operation Choke Point 2.0" - a reference to a controversial Obama-era initiative that allegedly pressured banks to cut ties with entire industries deemed risky, like gun shops or payday lenders. In recent years, crypto firms claim to have experienced similar treatment. The concern peaked under the Biden administration, when multiple banking partners cut services to exchanges and Web3 startups, often citing compliance or regulatory uncertainty.

While defenders of the banks argue these moves are simply risk-based decisions tied to anti-money laundering (AML) laws or evolving regulations, industry voices have increasingly labeled the trend as political in nature.

Eric Trump and the Personal Side of Debanking

Eric Trump, Donald Trump's second-oldest son, recently shared a personal story that illustrates the emotional and operational impact of debanking. Speaking at a crypto event, he said:

Eric Trump has since become involved in multiple crypto ventures, including a Bitcoin mining company and a DeFi project.

A Shift in Trump's Crypto Stance

What's striking is how dramatically President Trump's stance on crypto has evolved.

During his first term, he frequently criticized digital assets, calling them "highly volatile" and warning about criminal use. But as the 2024 campaign ramped up, Trump shifted gears - attracting support from major industry players like:

• Marc Andreessen (a16z Crypto)
• Caitlin Long (Custodia Bank)
• Brian Armstrong (Coinbase)
• Jesse Powell (Kraken)
• The Winklevoss twins (Gemini)
• Sam Kazemian (Frax Finance)

Much of this backing came amid frustration over regulatory hostility during the previous administration. Trump's new posture - promising to shut down Operation Choke Point 2.0 and build a pro-crypto environment - seems to have galvanized support.

The Legal Landscape Ahead

If implemented, this order could open the door to a wave of regulatory inquiries into debanking practices. Financial institutions would likely need to revise internal criteria for evaluating customers and document why certain businesses are denied service. It may also complicate their AML and compliance procedures, forcing them to walk a tightrope between risk management and potential accusations of discrimination.

There's also potential tension with independent financial regulators like the Federal Reserve, which traditionally operate with some separation from executive control. Trump's order may set up legal challenges if agencies push back against the directive.

What Comes Next?

As of now, the order is still in draft form, and its language could change before finalization. Still, the message is clear: the Trump administration wants to send a warning to the banking sector and reassure crypto firms that access to financial services is a priority.

With crypto playing a growing role in the political conversation - and even in campaign funding - the move could solidify the industry's position as a permanent player in Washington. Whether this order results in meaningful change or simply symbolic gestures will depend on how regulators respond - and how the market reacts.

Final Thoughts

This potential executive order marks one of the clearest signs yet that the Trump administration is aligning itself with crypto not just as a technology, but as a political cause.

Whether you view that as opportunism or evolution, it's undeniably a turning point. For crypto companies that have long operated on the financial margins, the promise of federal protection - or at least, investigation - offers a glimmer of relief.