U.S. Senator Cynthia Lummis has voiced strong criticism of Michael Barr, the Federal Reserve’s Vice Chair for Supervision, accusing him of contributing to what she describes as Operation Chokepoint 2.0.” Lummis claims this initiative has severely impacted Wyoming’s digital asset industry.
In a statement posted on X on January 6, she emphasized Barr’s failure to properly carry out his responsibilities, suggesting that the Federal Reserve is not accountable to the law, Congress, or the American people under his leadership.
Lummis expressed her dissatisfaction, saying, Michael Barr has completely failed to fulfill his duties as Vice Chair for Supervision at every turn, enabling Operation Chokepoint 2.0. It’s high time for the Federal Reserve to return to being accountable to the law, Congress, and the American people. We need a responsible regulator at the helm. I am looking forward to working with President Trump to make that happen.
Operation Chokepoint 2.0, according to Lexology, is a federal initiative aimed at pressuring banks to sever ties with businesses involved in cryptocurrency. Regulators have justified these actions by citing “reputational risk,” which has led to financial exclusion and substantial difficulties for the cryptocurrency sector.
One example of this initiative’s impact is the closure of Signature Bank, a major bank with strong ties to cryptocurrency businesses, on March 12, 2023. This closure followed a period of financial instability and withdrawal pressures from customers after the collapse of Silicon Valley Bank.
At the time, Signature Bank’s closure was the third-largest bank failure in U.S. history. While federal regulators claimed the closure was necessary to safeguard the U.S. economy, many saw it as part of a broader effort to target the cryptocurrency sector, according to Nasdaq.
Senator Lummis, who was sworn into the U.S. Senate on January 3, 2021, as Wyoming’s first female senator, has a long history in public service. She previously served as a U.S. Representative for Wyoming from 2008 to 2016 and held roles as Wyoming State Treasurer and a member of both the Wyoming State House and Senate.
Lummis holds degrees in animal science, biology, and law from the University of Wyoming, and has experience in ranching and public service.