Fed Teases New Account Model That Could Rewrite CryptoâEUR(TM)s Banking Access

Fed Teases New Account Model That Could Rewrite CryptoâEU... The Federal Reserve has opened public consultation on a new âEUR?"payment accountâEUR framework that may allow crypto and fintech firms limited access to U.S. payment infrastructure, potentially easing long-standing banking barriers. The post Fed Teases New Account Model That Could Rewrite CryptoâE... The Federal Reserve has opened the door to a new type of central bank account that could reshape how crypto and payment-focused firms access the US banking system, under a tailored approval framework.On Friday, the Fed requested public input on a proposed âEUR?"payment account.âEUR @federalreserve requests public input on âEUR?"payment account,âEUR which eligible financial institutions could use for the limited purpose of clearing and settling their payments: https://t.co/qlWK9fObui- Federal Reserve (@federalreserve) December 19, 2025 The account would sit alongside, but remain distinct from, the traditional master account that banks currently use to access Federal Reserve services. The comment period will remain open for 45 days following publication in the Federal Register.Fed Weighs Limited-Use Accounts to Ease Strain on Payment RailsThe proposal reflects how changes in the payments industry have begun to strain the Federal ReserveâEUR(TM)s long-standing account framework. New business models, including payment-focused fintech firms and crypto companies, have sought direct access to the FedâEUR(TM)s payment rails without engaging in lending, deposit-taking, or other activities associated with full-service banks. The Fed said the payment account is designed to meet those limited needs while reducing risks to the broader financial system.Under the proposal, payment accounts would not earn interest, would not provide access to Federal Reserve credit facilities, and would be subject to balance caps. The Fed is considering limits such as an overnight cap equal to the lesser of $500 million or 10% of an institutionâEUR(TM)s assets.Account holders would also be prohibited from offering correspondent services or settling transactions on behalf of other institutions. Use of the account would be restricted to clearing and settling the institutionâEUR(TM)s own payments, a design intended to lower supervisory and systemic risk and allow for a more streamlined review process than is required for full master accounts.Federal Reserve Governor Christopher Waller said the proposed account structure could encourage innovation while maintaining the safety and efficiency of the payments system. He described the request for information as an initial step toward modernizing central bank infrastructure, noting the FedâEUR(TM)s ongoing work with blockchain-based tools. Waller first urged the Fed to explore payment accounts for clearing and settlement in October. Fed proposes "payment accounts" granting stablecoin issuers direct Fed access without banks as Ripple and Anchorage Digital applications could see faster decisions.#Fed #Stablecoinhttps://t.co/RhCdQ7ZVaV- Cryptonews.com (@cryptonews) October 21, 2025 The Fed emphasized that the new model would not alter the legal eligibility requirements for access to Federal Reserve services.Instead, it would create a narrower access point within the FedâEUR(TM)s existing single master account framework, which typically allows one master account per chartered institution, supplemented by informational subaccounts that do not hold separate balances.After Years of Resistance, U.S. Bank Regulators Ease Crypto RestrictionsNot all Fed officials support the payment account proposal. Governor Michael Barr warned that expanding access without clearly defined safeguards could increase risks related to money laundering and terrorist financing, particularly for institutions the Fed does not directly supervise.The move follows years of controversy surrounding the Federal ReserveâEUR(TM)s handling of crypto-related applications.In 2023, the Fed adopted a policy that created a strong presumption against many crypto activities and denied Custodia BankâEUR(TM)s application for a master account after a 27-month review. Custodia, a Wyoming-chartered special purpose depository institution, has argued that the denial violates the Monetary Control Act, which states that payment services âEUR?"shall be availableâEUR to eligible institutions. The bank escalated its legal fight this month, seeking an en banc review from the Tenth Circuit Court of Appeals after a divided panel upheld the FedâEUR(TM)s decision. Custodia Bank petitions full appeals court to review Federal Reserve's master account denial, citing consti...