PANews reported on March 25 that David Sacks, the White House's director of encryption and AI, posted on the X platform that the Federal Deposit Insurance Corporation (FDIC) is following the footsteps of the Office of the Comptroller of the Currency to remove "reputation risk" as a factor in bank supervision, which is a huge victory for the crypto industry. "Reputation risk" sounds good in theory, but it is defined as "negative publicity about an institution's business practices, whether true or false, that may result in a decline in its customer base, high litigation costs, or reduced revenue." This vague and subjective standard was used to justify the deprivation of banking services to legitimate cryptocurrency companies through Operation Chokepoint 2.0. Bank standards should be objective and quantitative, not based on stories that may not be true.
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