U.S. Representative Maxine Waters has demanded answers from the Federal Reserve Bank of Kansas City regarding the approval of a limited-purpose master account for Kraken Financial. In a letter sent Thursday, Waters asked Kansas City Fed President Jeff Schmid to explain why and how Kraken received the account, requesting a response by April 10.
Waters, the ranking Democrat on the House Financial Services Committee, criticized the Fed's public announcement for lacking details about Kraken's access due to confidentiality rules. She sought clarification on the scope of Kraken's access, any conditions or restrictions, and the Anti-Money Laundering and consumer protection measures evaluated before approval.
Kraken's Wyoming-chartered banking unit became the first crypto-native company to obtain a Federal Reserve master account, granting it direct access to Fedwire, the Fed's core payments infrastructure. Waters expressed concerns about policy, regulatory, and consumer protection issues, emphasizing the need for transparency and clear legal grounding.
Waters argued that rapid innovations in payments, digital assets, and AI are outpacing traditional statutory frameworks. She also highlighted her past opposition to crypto legislation, including the Digital Asset Market Clarity Act and the GENIUS Act, and her call for a hearing with SEC Chair Paul Atkins over crypto enforcement cases.
Kraken is not alone in seeking Federal Reserve account access. Custodia Bank, Anchorage Digital Bank, and Ripple's Standard Custody & Trust Company have also pursued similar access. Waters stressed the importance of ensuring the approval process is conducted consistently with the law and impartiality.