Cryptoraves a crypto startup that is working on the tokenization of the social media has had its bank account shut down by JP Morgan Chase without prior explanation. The startup was served with a notice that said they were working on a “prohibited industry” not long ago after news of the bank launching its own coin had surfaced.
The notice read:
“After a recent review of your account, we have decided to end our relationship with you.”
The crypto company offers a token that is meant to boost credibility on social media. For example, a Twitter user can request free Cryptoraves tokens and send them to other Twitter users. Currently, the tokens themselves don’t have any actual value, and this means they are not breaking any securities regulations.
However, according to Bryan Plasters, of Cryptoraves, the action taken by JP Morgan Chase would have been influenced by recent wire transfers the company did. In a blog post the company wrote:
“We did send two wire transfers to Gemini to buy ETH and LOOM in order to cover future blockchain fees. We suspected that these transactions flagged our account, but the Chase rep would not confirm this. They would not give us a reason for the closure. We called the number in the letter, and the agent told us to visit a branch for these details. Visiting our branch resulted in no other details except when our branch rep pressed the agent (yep as the primary course of action, our rep called the same phone number), they said we were operating in a ‘prohibited industry’. I guess JPM’s own blockchain department didn’t get the memo?”
The letter is dated just one day after the bank launched its own digital coin that is supposed to ease international payments by cutting fees for its major clients.
What’s your take on the JP Morgan Chase decision to close Cryptoraves account without an explanation? Share your thoughts in the comment section below.