Who is Custodia bank?

Custodia Bank, a Wyoming-based digital asset bank, has taken legal action against the Federal Reserve Bank of Kansas City and the Board of the Federal Reserve to force the institutions to issue a decision on the bank’s application to access the Fed’s Master Accounts.

Why did Custodia file a lawsuit against the Fed?

The bank filed a lawsuit against the Kansas City Fed and the Federal Reserve Board of Governors for the “patently unlawful delay.” Then in January, the Kansas City Fed formally rejected Custodia’s application and, after being asked to consider a revised business plan, doubled down on its decision last week.

Does Custodia Bank have a 'patently unlawful' crackdown on cryptocurrency?

I cover cryptocurrency for Forbes Digital Assets. Custodia Bank is accusing the Federal Reserve Board of “patently unlawful” actions that will prevent the company from providing financial services to the digital-assets industry, part of a wider government crackdown on the cryptocurrency sector that has intensified in recent days.

Is Custodia Bank too risky?

The Fed published an 86-page order explaining its decision in March, arguing that Custodia Bank’s business model is simply too risky because, among other things, it lacks FDIC deposit insurance, which is used to make deposit holders whole in the event of a bank failure.