Caitlin Long says Trump's crypto moves could upend the public payment network
The Scoop's host, Frank Chaparro, was joined by Custodia Bank Founder and CEO Caitlin Long.
In this episode, Chaparro and Long discussed the state of crypto banking, the potential restructuring of regulations under the Trump administration, and the Federal Reserve's stance on crypto.
OUTLINE
00:00 Introduction
1:39 Powell’s crypto remarks
3:02 Custodia and the Fed
7:19 Trump’s crypto executive order
8:34 Banks’ path to crypto custody
12:12 12 month forecast
17:51 State of crypto banking
24:34 The Crypto Vote
30:15 Trump’s meme coin
32:50 Privatising fed wire
38:40 Crypto in Wyoming
41:25 Closing thoughts
GUEST LINKS
Caitlin Long - https://www.linkedin.com/in/caitlin-long-/
Caitlin Long on X - https://x.com/CaitlinLong_
Custodia Bank - https://custodiabank.com/
Custodia Bank on X - https://x.com/CustodiaBank
Caitlin Long on Why the Fed’s Rejections of Custodia Bank Seem Politically Motivated - Ep. 687
Custodia, established as a special purpose depository institution in Wyoming, aimed to offer secure banking services for the crypto sector. Despite meeting state requirements and taking extra steps to demonstrate its commitment to safety, Custodia’s application for a Fed master account was met with delays and ultimately denied in an unprecedented 86-page report.
In this episode, Caitlin and Michelle explain why they believe the Fed’s rejection was politically motivated, how this relates to Operation Choke Point 2.0, the appallingly small number of American banks owned by women, where they are in their lawsuit against the Fed, and what this case means for the future of crypto banking in the U.S.
Show highlights:
00:00 Intro
01:52 What Custodia Bank is and how it got started in Wyoming
06:04 How Custodia got into a fight with the Fed to get its master account
09:58 How the dual banking system works in the U.S. and the differences between Custodia and traditional banks
18:15 Why Custodia filed a lawsuit against its own regulator
24:33 Why the Fed denied Custodia its applications and Caitlin’s response to the criticisms
29:57 The political coordination meant to “intimidate” Custodia, according to Caitlin
42:43 The amicus briefs that were filed in favor of Custodia
48:48 Caitlin’s reaction to the Fed’s enforcement action against Customers Bank
53:35 Why Caitlin says that it’s “abusive and corporatist” that the SEC is granting exceptions to big banks
56:03 Why so few banks are owned by women and whether this played a role in Custodia’s denial
59:25 The next steps in Custodia’s case and whether a stablecoin is viable for them
1:05:21 Whether the elections are going to impact the case
Visit our website for breaking news, analysis, op-eds, articles to learn about crypto, and much more: unchainedcrypto.com
Thank you to our sponsors!
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Guests:
Caitlin Long, Founder & CEO of Custodia Bank
Previous appearances on Unchained:
Why Caitlin Long and Meltem Demirors Are Worried About Crypto’s Future in the US
Caitlin Long: Why Avanti Will Be a New Kind of Crypto Bank
Michelle Kallen, Partner at Jenner & Block
Links
Timeline
PerkinsCoie: Federal Reserve Issues Final Guidelines for Master Account Access
CoinDesk: Crypto Bank Custodia Sues Federal Reserve
Davis Polk: Crypto bank sues Federal Reserve over delay in master account application
Fed’s 86-page report of its denial of Custodia’s membership
Custodia’s response to the Fed report
Custodia’s amended filing
Judge Scott Skavdahl’s order to dismiss
Davis Polk: District courts refuse to order Federal Reserve to grant master accounts to Custodia
Appeal
Custodia’s appeal notice
Custodia’s appeal filing
Amicus briefs for the appeal
Bitcoin Magazine: The Federal Reserve, Custodia Bank, And The Battle For Sovereignty
Paul Clement on behalf of the Digital Chamber and Global Blockchain Business Council (GBBC)
Don Verrilli for Blockchain Association
State of Wyoming
Americans for Prosperity Foundation
Members of the United States Senate Banking Committee and House Financial Services Committee
Former Sen. Patrick Toomey
Customers Bank:
CoinGeek: ‘Crypto’-friendly Customers Bank hit with Fed Reserve enforcement action
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Wall Street Veteran Explains How US Regulators Are Protecting Incumbents
Today, we're joined by Caitlin Long, the founder and CEO of Custodia Bank, which provides payment rails and custody services for digital assets.
We explore the recent surge of institutional interest in crypto, regulatory pressure in the US, and whether US regulators are prioritizing investor protection or incumbent interest.
But first, we start by delving into Caitlin's journey as an early adopter of blockchain tech.
Why Caitlin Long and Meltem Demirors Are Worried About Crypto’s Future in the US - Ep. 470
Caitlin Long, founder and CEO of Custodia Bank, and Meltem Demirors, chief strategy officer of CoinShares, share their concerns about crypto in the U.S. following a wild week in the banking sector. With Signature Bank’s takeover looking like a targeted takedown and crypto-friendly upstarts like Custodia being shadowbanned by the Fed, the two longtime experts look ahead at the fights to come. Is USDC next to land in regulators’ crosshairs?
Listen to the episode on Apple Podcasts, Spotify, Overcast, Podcast Addict, Pocket Casts, Stitcher, Castbox, Google Podcasts, TuneIn, Amazon Music, or on your favorite podcast platform.
Show highlights:
how crypto is viewed as a “big, scary, and strange” industry
how Signature and Silvergate became so important for the crypto industry with SEN and Signet
why Caitlin says it’s “crystal clear” that we are now in Operation Choke Point 2.0, with U.S. regulators pushing to debank the crypto industry
why Caitlin says the Fed’s vote against Custodia’s application was preordained
whether Sen. Elizabeth Warren had an impact on the current crisis
how everything comes down to game theory
whether VCs are responsible for causing the bank run
whether the rollback in 2018 of certain provisions of the Dodd-Frank Act played a role in the recent collapse
Caitlin’s hot takes on what happened with Signature Bank
the unique characteristics of Custodia’s business model as a bank
how stablecoins challenge the current financial system
why it’s so important for crypto to improve its public perception
Thank you to our sponsors!
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Guests:
Meltem Demirors, Chief Strategy Officer at CoinShares
Caitlin Long, founder and CEO of Custodia Bank
Links
Previous coverage of Unchained:
Jim Bianco on Why the Banking System Has Always Been Broken
The Fed Is In Checkmate: What Will Powell Do?
The Fall of SVB: What Happened and How It Affects Crypto
NYT: Congress Approves First Big Dodd-Frank Rollback
NYMAG: Barney Frank Talks More About the Surprise Shuttering of Signature Bank
WSJ Editorial Board: Signature Bank’s Crypto Execution
Unchained:
FDIC Denies Asking Signature Buyers to Give Up Crypto: Report
Was Signature Bank Actually Insolvent?
Circle to Bring On New Banking Partner for USDC Minting, Redemption
Circle Clears Backlog of USDC Minting and Redemption Requests
Regulators Close Signature Bank Following SVB Collapse
Silvergate to Wind Down Operations in ‘Voluntary Liquidation’
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Caitlin Long: Why Avanti Will Be a New Kind of Crypto Bank - Ep.216
Caitlin Long, founder and CEO of Avanti Financial Group, talks about the issues plaguing the current state of technology in traditional finance and how her background as a 22-year Wall Street veteran, gubernatorial appointee to the Wyoming Blockchain Task Force, and crypto pioneer is helping her shape Avanti into a bridge between conventional banking and crypto. Tune in to hear Caitlin discuss:
the current state of crypto adoption on Wall Street (1:09)
how her entrepreneurial spirit galvanized a career spanning Wall Street, the Wyoming Legislature, and, now, crypto banking (2:07)
why Caitlin fell in love with Bitcoin (4:57)
fractional reserves and why the current financial system is a “violation of property rights” (7:00)
how stablecoin technology will change banking leverage and what effects faster settlement times will have on inflation (11:30)
why corporate treasurers have been using BTC since 2014 in foreign exchange transactions (17:14)
what issues Wyoming is trying to solve through crypto legislation and why banks might be closing down customer accounts linked to crypto exchanges (19:18)
a proposed Wyoming bill that would prohibit judges from disclosing private cryptographic keys (28:32)
where the idea for Avanti came from and how it will be different than other banks (32:50)
existing problems with stablecoin regulation and a deep-dive into GAAP accounting for crypto (46:51)
why Wall Street’s accounting system is to blame for the GameStop and Robinhood situation (52:32)
whether or not a blockchain could work for settling securities (52:32)
her thoughts on pension funds and endowments directly owning crypto (59:54)
what it is going to take for Avanti to successfully bridge the gap between traditional finance and crypto (1:02:38)
Thank you to our sponsors!
Crypto.com: https://bit.ly/3jzkTAD
Download the Crypto.com app here: https://crypto.onelink.me/J9Lg/laurashinpodcasttesla
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Episode links:
Caitlin Long
Twitter: https://twitter.com/CaitlinLong_
Personal website: https://caitlin-long.com/
CoinDesk profile: https://www.coindesk.com/most-influential/2019/caitlin-long
Avanti
Website: https://avantibank.com/
Twitter announcement: https://twitter.com/CaitlinLong_/status/1231958552790482950
Avit: https://www.coindesk.com/unpacking-the-avit-avanti-banks-new-digital-asset-being-built-with-blockstream
Banking charter: https://www.forbes.com/sites/michaeldelcastillo/2020/10/28/avanti-unanimously-wins-bitcoin-banking-charter/?sh=50db610816aa
Wyoming and blockchain: https://www.coindesk.com/haven-blockchain-case-wyoming
GAAP accounting and crypto: https://twitter.com/CaitlinLong_/status/1356759511856410624
Trust charter vs. SPDI: https://twitter.com/CaitlinLong_/status/1349850451374587907
Special purpose depository institutions: https://twitter.com/CaitlinLong_/status/1194022779730968577
Bailment: https://www.forbes.com/sites/andreatinianow/2019/03/07/a-split-emerges-in-blockchain-law-wyomings-approach-versus-the-supplemental-act/?sh=49635109719a
Caitlin on GameStop:
https://www.coindesk.com/first-mover-crypto-gamestop-bitcoin-dogecoin
Previous Episodes
On How 'Utility Tokens' Are Now Legal in Wyoming, 2018
Why the ICE/BAKKT News Makes Some Crypto Investors Nervous, 2018
How Avanti Will Be a 'Not Your Keys, Not Your Coins' Bank, Feb 2020
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Unconfirmed: Caitlin Long on How 'Utility Tokens' Are Now Legal In Wyoming
Wyoming now has five blockchain-specific laws. Caitlin Long, cofounder of the Wyoming Blockchain Coalition, describes what these laws are, what they mean, and how our least populous state became a crypto leader. The former chairman and president of Symbiont explains what this could mean for any project that aims to launch a utility token, whether or not ICOs held in Wyoming would only be available to Wyoming residents, and what big issue she thinks remains for the SEC to address.
Caitlin Long: https://www.linkedin.com/in/caitlin-long-/
To read the laws: https://legiscan.com/WY/bill/HB0070/2018
An op-ed Caitlin co-authored with WY House Rep. Tyler Lindholm: https://www.coindesk.com/haven-blockchain-case-wyoming/
Thank you to our sponsors, Onramp http://www.thinkonramp.com/ and Quantstamp: https://quantstamp.com/
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