Blockchain Association urges review of Custodia Banks master account denial
The Blockchain Association has backed Custodia Bank‘s Supreme Court petition challenging the Federal Reserve’s refusal to grant the Wyoming-chartered digital asset bank direct access to its payment system. According to a Wednesday amicus filing, the Blockchain Association asked the U.S. Supreme Court to review whether regional Federal Reserve Banks can deny master accounts to state-chartered institutions that are legally eligible to request access. The dispute centers on the authority regional Fed banks have when deciding which institutions can connect directly to central bank payment infrastructure. Custodia has argued that the Monetary Control Act requires the Fed to make its payment services available to eligible nonmember depository institutions, while lower courts have ruled that regional Reserve Banks retain discretion over whether to approve an application. In its filing, the industry group warned that allowing that discretion to stand could affect state-chartered banks serving lawful industries that federal regulators may view unfavorably. “No lawful industry should be excluded from essential banking services through regulatory pressure or unchecked administrative discretion,” the association said in an accompanying X thread. The group added that the case concerns whether “lawful digital asset businesses can compete on equal footing” when seeking access to financial infrastructure. Blockchain Association says Custodia Bank case could affect