Crypto▲ Bullish
Crypto Trade Group Backs Custodia Bank in Supreme Court Fed Fight
The Blockchain Association argues the Fed cannot arbitrarily deny master accounts to state-chartered crypto banks. Kraken's conditional approval shows the stakes at play.
Continue with
The Blockchain Association has thrown its weight behind Custodia Bank in a Supreme Court appeal that could decide how digital asset firms connect to the U.S. payment system. The trade group filed an amicus brief urging the justices to hear Custodia's challenge to a lower-court ruling that gave regional Federal Reserve banks broad discretion over master account applications.
Custodia argues that the Monetary Control Act requires the Federal Reserve to provide payment services to any qualifying state-chartered bank. The Kansas City Fed rejected Custodia's application in January 2023, citing risks tied to its crypto-focused business model. The Tenth Circuit upheld that decision, saying Reserve branches have final say over who gets access.
The case tests a question with consequences beyond one Wyoming bank. The Blockchain Association says that unchecked discretion lets regional branches pick winners and losers in the financial system. State-chartered institutions that meet statutory prerequisites deserve uniform consideration, the group argues.