Blockchain Association Backs Custodia in Fed Account Fight
The Blockchain Association has filed an amicus brief in support of Custodia Bank's petition to the US Supreme Court, urging the court to review the Federal Reserve's denial of a master account.
Custodia, a Wyoming-chartered bank, applied for a master account in 2020 but was rejected by the Federal Reserve Bank of Kansas City in 2023. The Tenth Circuit ruled that the Kansas City Fed had discretion to deny the account, prompting Custodia to seek Supreme Court review.
A master account would allow Custodia to settle payments directly through the Federal Reserve, rather than relying on an intermediary bank. The Blockchain Association argues that federal law does not give the Fed broad discretion to deny payment system access to eligible state-chartered banks.
The dispute comes as another Wyoming-chartered institution, Kraken Financial, has successfully gained Fed access with a limited, or 'skinny,' account.