What a Federal Reserve Master Account Means for Banks and Crypto Firms

[mendez]

A Federal Reserve master account is one of the most important tools for financial institutions.

It allows banks to hold reserves directly at the Federal Reserve and access core payment systems like Fedwire, enabling them to settle transactions without relying on intermediary banks.

Crypto-focused Custodia Bank spent five years trying to obtain one but was ultimately denied by US courts.

Meanwhile, crypto exchange Kraken recently secured a master account through the Federal Reserve Bank of Kansas City, becoming the first crypto platform to gain such access — though with limited services.

The development has sparked discussions about whether regulators may introduce “skinny” or restricted master accounts for crypto companies in the future.

[cryptoenthusiast]

me watching Custodia’s appeal fail: facepalm
Kraken in the background: “hold my stablecoin”