Ripple’s David Schwartz Criticizes Fed Over United Texas Bank Sanctions

David Schwartz Criticizes Fed’s Sanctions on United Texas Bank’s Crypto Operations

In a post, CTO of Ripple David Schwartz criticized the chairman of the Federal Reserve and the Fed for sanctioning United Texas Bank because of the bank’s dealings with cryptocurrency customers. Schwartz commented on an X post by Dennis Porter, president and co-founder of the Satoshi Action Fund. Porter shared a screenshot of a document containing the Federal Reserve’s decision on United Texas Bank.

In particular, risk management and compliance with applicable laws, rules, and regulations relating to anti-money laundering (AML), including the Bank Secrecy Act, were found to be seriously deficient in relation to foreign correspondent banking and virtual currency customers, according to the portion of the document displayed in the screenshot.

Schwartz Decries Government’s Use of Indirect Regulation to Target Crypto Businesses

The Ripple CTO objected to government attempts to regulate the cryptocurrency market, calling them indirect regulation, and cited this tweet in support of his position. Schwartz called for the courts to block the Fed Reserve and other authorities from engaging in similar actions, calling it an end-run around due process.

In an explicit statement, Schwartz said that if the US government wanted to punish cryptocurrency companies, it should just file lawsuits against them. The CTO claims that instead of crypto companies being directly targeted, it is the business partners of crypto companies that suffer as a result of doing business with them. In Schwartz’s opinion, the government penalizes digital currency companies in this way by denying them access to future commercial partnerships without granting people any of the standard protections that due process requires.

For more up-to-date crypto news, you can follow Crypto Data Space.