Blockchain Association argues Fed’s rejection of Custodia’s master account sets precedent for regulatory overreach against digital asset firms.
The Blockchain Association filed an amicus brief urging the Supreme Court to review the Federal Reserve’s denial of a master account to Custodia Bank, a Wyoming-based crypto bank. The group argues the Fed’s decision enables regulators to exclude lawful digital asset businesses from the banking system without clear authority.
Custodia, which offers custody and stablecoin services, was denied a Fed master account in 2022, a ruling upheld by a lower court. The case centers on whether the Fed can use payment system access as a tool to shape industry participation, particularly for state-chartered banks.
The outcome could define the limits of federal regulatory power over financial institutions serving crypto firms. No immediate market reaction was reported.