Custodia Bank Loses Appeal Over Fed Master Account Access
The 10th Circuit Court of Appeals delivered a decisive blow to Custodia Bank, ruling in favor of the Federal Reserve's discretion to deny master account access. The Wyoming-based bank, a pioneer in bridging crypto and traditional finance, sought to compel the Fed to grant it entry into the U.S. payment system. A 2–1 decision upheld the central bank's authority, reinforcing its gatekeeper role over critical financial infrastructure like Fedwire and ACH.
Custodia's founder Caitlin Long framed the legal battle as a test of regulatory inclusivity for digital asset banks. The court's rejection forces crypto-focused institutions to remain dependent on intermediaries, potentially stifling innovation. This ruling crystallizes the Fed's unchallenged power to shape banking access—even for state-chartered entities operating under specialized frameworks like Wyoming's crypto-friendly regime.
