Custodia Bank CEO Analyzes Trump’s Executive Order on Crypto Debanking

On August 7, U.S. President Donald Trump signed an executive order imposing penalties on banks for refusing to serve crypto companies. Caitlin Long, founder of Custodia, dissected the key aspects of the document.

1/ DIGGING THRU Trump’s #debanking executive order—it contains some hidden gems!!! The first one is a doozy—shows the @WhiteHouse understands it can’t trust the federal banking regulators: It brought in an overseer to keep ’em honest (with good reason!).https://t.co/Ms3Tedrdrc

— Caitlin Long 🔑⚡️🟠 (@CaitlinLong_) August 8, 2025

The order targets Operation Choke Point 2.0—a practice where banks, under regulatory pressure, severed ties with crypto firms.

Oversight Instead of Trust

According to Long, the main surprise was the appointment of an independent overseer—the Small Business Administration (SBA), which will now monitor the actions of banking regulators (Fed, FDIC, and OCC).

Trump appointed Kelly Loeffler, former head of the Bitcoin platform Bakkt and a known supporter of the crypto industry, as head of the SBA. As noted by the Custodia founder, this confirms the seriousness of the current administration’s intentions.

“It’s very telling—the White House doesn’t trust the three federal banking regulators to clean up their own houses. But the SBA has jurisdiction, so it’s being brought in as a super-regulator over the other three. Tactically, it’s a creative move. The President is serious,” she wrote.

Trump’s order also defines “politicized debanking” as the refusal to serve any lawful business, without specifically naming the crypto sector. In Long’s view, this sets a precedent: credit organizations can no longer close accounts simply because their client deals with digital assets.

“Banks that refused service or closed accounts of legitimate crypto companies will be held accountable,” she stated.

Custodia also suffered from debanking, despite complying with all regulatory requirements. In July 2021, Long criticized the Fed for its biased attitude towards firms working with cryptocurrency. In 2022, the bank sued the regulator.

The Custodia founder pointed to political bias within the Fed and FDIC. Donation data shows that 92% of contributions from these agencies’ employees in 2024 went to Democratic Party candidates. According to Long, this may have influenced debanking decisions under Biden.

Back in February 2023, the CEO of the crypto bank suggested corruption in the industry’s regulatory matters.