Fed denies Custodia Bank application to join the Federal Reserve System

The Federal Reserve Board has rejected Custodia Bank’s exertion to go a subordinate of the Federal Reserve System. In its announcement, the Fed stated that the exertion was “inconsistent with the required factors nether the law.” It besides claimed Custodia had an “insufficient” absorption model and cited an earlier associated declaration by the Fed with the Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency that recovered crypto assets to beryllium astatine likelihood with dependable banking practices. 

STATEMENT FROM CUSTODIA BANK astir today's Federal Reserve enactment connected its rank application. Its maestro relationship exertion remains pending: pic.twitter.com/QkMjcT508J

— Custodia Bank ™ (@custodiabank) January 27, 2023

In spite of the rejection, the bank's exertion for a maestro relationship remains pending, the slope said successful a tweet. A alleged “master account” that comes from Reserve rank enables a slope to marque planetary transfers and transportation retired different important functions. Custodia, headed by Caitlin Long, applied for the maestro relationship successful 2020 and sued the Fed implicit the agelong hold successful considering the exertion successful June.

This nonfiction is nether development.