- JPMorgan flags sanctions exposure, triggering account freezes for 2 stablecoin startups.
- BlindPay and Kontigo accessed banking services through JPMorgan partner Checkbook.
- Chargebacks and Venezuela-linked activity intensified compliance scrutiny on crypto payment firms.
JPMorgan Chase has frozen bank accounts connected to 2 stablecoin startups after flagging sanctions-related exposure. The affected firms, according to The Information, are BlindPay and Kontigo, both backed by Y Combinator. Rather than signaling hostility toward digital assets, the move reflects heightened compliance scrutiny. According to people familiar with the matter, the bank identified transaction links to Venezuela and other restricted regions.
BlindPay and Kontigo primarily operate across Latin America and serve cross-border payment users.
However, neither startup held a direct banking relationship with JPMorgan Chase. Instead, both firms accessed JPMorgan’s banking infrastructure through Checkbook, a digital payments provider. According to the report, Checkbook partners with large US banks to support fintech payment operations.
A JPMorgan spokesperson, according to The Information, said the action had nothing to do with stablecoins. The spokesperson added that the bank continues to work with stablecoin issuers and related businesses. Still, additional context from Checkbook suggests operational risk factors influenced the decision.
According to Checkbook CEO PJ Gupta, BlindPay and Kontigo were linked to a surge in chargebacks. Moreover, Gupta said the increase followed rapid customer onboarding that weakened internal controls. He explained that fast online signups allowed higher-risk users to enter the system.
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Compliance Pressure Grows as Payment Partnerships Deepen
Meanwhile, the account freezes occurred as JPMorgan and Checkbook expanded their partnership.
The companies recently integrated Checkbook into the J.P. Morgan Payments Partner Network. Additionally, the partnership allows corporate clients to send digital checks through JPMorgan’s payment rails.
Checkbook has also expanded its B2B services into legal, government, and banking sectors. Hence, the incident highlights growing pressure on banks to balance innovation with regulatory compliance.
US financial institutions face strict obligations when exposure to sanctioned jurisdictions appears.
The situation also reflects broader trends across Latin America’s digital asset economy. Cryptocurrencies play a key role in Venezuela amid currency collapse and capital controls. As a result, fintech firms operating in the region face elevated scrutiny from US banking partners. Sanctions enforcement has become a decisive factor in determining access to traditional financial services.
JPMorgan’s actions follow other disputes involving crypto-related firms and banking access.
Earlier, Gemini co-founder Tyler Winklevoss accused the bank of delaying onboarding after public criticism. Despite these tensions, JPMorgan continues to explore crypto-related offerings for institutional clients. Reports indicate the bank is considering spot and derivatives trading as regulatory clarity improves.
Conclusion
The account freezes underline how sanctions risk now shapes banking access for stablecoin startups.
Consequently, fintech firms operating across sensitive jurisdictions may face tighter compliance expectations going forward.
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