Elizabeth Warren could reopen crypto’s banking fight without changing a single law

As Democrats prepare to take control of the Senate, Elizabeth Warren is positioned to chair the powerful Senate Banking Committee in January. This role would give her substantial authority to determine which hearings are held and what investigations are conducted, particularly regarding the crypto industry.

Warren has already begun gathering information from crypto companies, requesting their bank applications, trading safeguard records, and explanations of government decisions involving the president's family. These requests suggest she plans to examine existing approvals and licenses rather than pursue new legislation.

Oversight Powers Without New Laws

Passing new crypto legislation would require support in both chambers of Congress. However, as Banking Committee chair, Warren can leverage the committee's existing oversight powers to scrutinize approvals and licenses regulators have already granted.

Regulators retain the authority to suspend or revoke licenses, while Warren can maintain inquiries through hearings and record requests. This approach could force officials who approved company plans to explain their decision-making process publicly.

Focus on Existing Approvals

Warren's attention has already turned to companies like Coinbase, which received final approval for its national trust company on November 9. She has requested applications and legal analyses for nine charter decisions involving crypto companies, including Coinbase and Ripple.

The senator has specifically asked for confidential communications about charters involving the White House or the president's family, arguing that some crypto companies were permitted to conduct 'bank-like activities' with fewer obligations than conventional banks.

Potential Consequences for Crypto Firms

Companies that believed their licensing battles were over could face months of legal expenses as they review old records and prepare executives to defend decisions they considered settled. Warren's inquiries could also lead to regulatory action if evidence suggests improper approvals.

The Senate Banking Committee can compel testimony through subpoenas, though enforcement requires either minority party consent or a majority vote. While Warren cannot personally impose penalties, her investigations could prompt regulators to take action under existing laws.

The committee's oversight extends to examining whether companies' public assurances about safety align with their internal practices. Discrepancies could lead to customer questions, regulatory scrutiny, and potential enforcement actions.