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JPMorgan Chase froze accounts linked to two Y Combinator-backed stablecoin startups after detecting exposure to Venezuela, a country under strict US sanctions. The action affected Blindpay and Kontigo after internal reviews flagged connections to high-risk jurisdictions, according to reporting by The Information.
Both startups accessed JPMorgan services through Checkbook, a US-based payments firm, which triggered enhanced monitoring once Venezuela-related activity appeared. The bank stated that the move focused on sanctions compliance rather than on digital assets, noting that it continues to work with stablecoin issuers and related businesses.
Why are banks tightening controls as stablecoins expand into global payment systems?
Blindpay and Kontigo reportedly conducted transactions involving Venezuela, raising concerns about US financial rules and sanctions enforcement. JPMorgan must verify counterparties and the origins of transactions to meet regulatory standards or risk scrutiny from agencies such as the Securities and Exchange Commission.
As a result, internal compliance teams escalated the matter after identifying links to sanctioned regions. A JPMorgan spokesperson said the action did not target stablecoins directly, stressing the bank’s broader involvement with digital asset firms.
Still, the freeze reflected how exposure to high-risk regions can disrupt access to traditional banking infrastructure.
The account freeze occurred as Donald Trump increased pressure on Venezuela through new enforcement actions. Two weeks earlier, US authorities intercepted two tankers carrying Venezuelan oil, while officials tracked a third vessel. Trump said the US might sell the seized oil, store it, or place it in strategic reserves, while retaining control of the ships.
At the center of enforcement sits PDVSA, blacklisted under Executive Orders 13850 and 13884 since 2019. The Treasury Department claims oil sales help sustain Nicolás Maduro’s government, while officials recently labeled fentanyl flows through Venezuela a national security threat.
Despite enforcement actions, stablecoin momentum continues to build across regulated markets. This month, the Federal Deposit Insurance Corporation proposed an approval framework for stablecoins under the GENIUS Act.
The proposal would enable US banks to issue regulated payment stablecoins through subsidiaries, placing them in direct competition with crypto-native firms. Internationally, Sony Bank plans to launch a US dollar-pegged stablecoin by 2026. Western Union also announced plans for a US Dollar Payment Token on the Anchorage Digital Bank platform in early 2026.
JPMorgan froze accounts linked to Blindpay and Kontigo after Venezuela exposure raised sanctions and compliance concerns. The action reflects strict bank due diligence amid heightened enforcement in the US. As stablecoins expand, firms operating across borders must align operations with sanctions rules to maintain banking access.
Also Read: JPMorgan Rejects Claims of Crypto and Political Debanking
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