Accounts belonging to two stablecoin startups, BlindPay and Kontigo, have been frozen by JPMorgan Chase due to concerns over exposure to sanctioned regions, particularly Venezuela. These startups, which are backed by Y Combinator and primarily operate in Latin America, accessed JPMorgan's banking services via Checkbook, a digital payments firm.
The decision was made after JPMorgan identified business activities that raised red flags regarding compliance with US sanctions. A spokesperson for the bank clarified that the move was not a reflection of its stance on stablecoin companies, noting that they continue to serve both stablecoin issuers and related businesses.
Checkbook's CEO, PJ Gupta, mentioned that the account closures were also linked to a surge in chargebacks, attributed to a rapid increase in customer onboarding. As part of their ongoing collaboration, Checkbook aims to enhance its B2B payment services, having recently expanded offerings for various sectors.