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JPMorgan Chase has frozen JPMorgan accounts linked to two venture-backed stablecoin startups, raising fresh questions for crypto investors, policymakers and fintech founders about how sanctions compliance is shaping access to traditional banking.
The affected firms, BlindPay and Kontigo, are both backed by Y Combinator and operate primarily across Latin America. According to a report by The Information, the action followed internal reviews that flagged exposure to sanctioned and high-risk jurisdictions, including Venezuela.
The move places JPMorgan accounts at the center of a broader debate over how global banks manage crypto-related risks at a time when stablecoins are increasingly used for cross-border payments and inflation hedging.
While the freezes do not represent a public enforcement action, they underscore the compliance pressures facing both banks and crypto startups navigating US sanctions regimes.
The report states that BlindPay and Kontigo accessed JPMorgan accounts indirectly through Checkbook, a digital payments company that partners with large financial institutions. JPMorgan reportedly identified transactions or business activity connected to Venezuela and other locations subject to US sanctions, prompting the freezes.
A JPMorgan spokesperson emphasized that the decision was not ideological opposition to crypto or stablecoins.
“This has nothing to do with stablecoin companies,” the spokesperson told The Information. “We bank both stablecoin issuers and stablecoin-related businesses, and we recently took a stablecoin issuer public.”
For policymakers, the episode highlights how sanctions enforcement often operates quietly through private financial institutions rather than headline-grabbing penalties.
For crypto investors, it signals that JPMorgan accounts — often viewed as a gold standard for institutional legitimacy — remain contingent on strict compliance with evolving geopolitical rules.
Checkbook CEO PJ Gupta told The Information that BlindPay and Kontigo were among several firms connected to a surge in chargebacks, which contributed to the account closures.
According to Gupta, the problem stemmed from rapid customer onboarding.
“They opened the floodgates and a bunch of people came in over the internet,” he said.
This explanation adds another layer to why JPMorgan accounts were frozen. Beyond sanctions exposure, operational risk and consumer protection issues such as chargebacks can quickly escalate into compliance red flags for large banks.
For startups operating at speed, especially in emerging markets, scaling user acquisition without triggering banking alarms remains a delicate balance.
The timing is notable. JPMorgan and Checkbook have been expanding their relationship, with the payments firm joining the J.P. Morgan Payments Partner Network in November 2024.
The partnership allows corporate clients to send digital checks and supports Checkbook’s broader push into B2B payments across sectors including legal services, government and banking.
That deepening collaboration makes the freezing of JPMorgan accounts tied to Checkbook-linked clients particularly significant for the fintech ecosystem.
The sanctions-linked exposure reportedly involved Venezuela, where cryptocurrencies have become a core part of daily economic life.
As previously reported by Cointelegraph, many Venezuelans use digital assets to hedge against hyperinflation, currency controls and financial instability. Stablecoins, in particular, play a central role in remittances and commerce.
This reality creates friction for global banks. On one hand, demand for stablecoin rails is growing in sanctioned or high-risk jurisdictions.
On the other, US banks must ensure that JPMorgan accounts do not facilitate activity that could breach sanctions rules. The BlindPay and Kontigo freezes illustrate how that tension is resolved in practice — often by erring on the side of caution.
Cointelegraph said it reached out to JPMorgan for comment but had not received a response by the time of publication.
The account freezes arrive amid heightened sensitivity around what some industry figures describe as “debanking.”
In a related but separate incident earlier this year, Gemini co-founder Tyler Winklevoss claimed JPMorgan Chase paused the crypto exchange’s re-onboarding process after he publicly criticized the bank’s data access policies. Winklevoss accused the bank of anti-competitive behavior that could harm fintech and crypto firms.
At the same time, JPMorgan has signaled growing interest in digital assets. The bank is reportedly exploring crypto-backed loans and weighing plans to offer crypto trading — including spot and derivatives products — to institutional clients as US regulatory conditions become more favorable.
This dual track makes the scrutiny of JPMorgan accounts especially relevant: even as the bank expands crypto offerings, access to its balance sheet remains tightly controlled.
For regulators and lawmakers, the BlindPay and Kontigo case underscores the importance of clarity around sanctions compliance in a world where financial activity is increasingly tokenized and borderless.
For startups, it serves as a reminder that securing JPMorgan accounts is not a one-time achievement but an ongoing compliance challenge.
As stablecoins move deeper into mainstream finance, the freezing of JPMorgan accounts linked to sanctioned exposure may become less an exception and more a defining feature of the sector’s maturation.
