Custodia Bank Loses Bid for Rehearing in Fed Master Account Case

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A Wyoming-based cryptocurrency bank, Custodia Bank, has lost its bid to force the Federal Reserve to grant it access to the central bank's payments systems. The US Court of Appeals for the Tenth Circuit denied Custodia's petition for a full court review of a previous split panel ruling that affirmed the Biden-era decision by the Fed's Board of Governors and the Federal Reserve Bank of Kansas City to deny the bank's request for a master account.

Why it matters

This case highlights the ongoing tensions between the cryptocurrency industry and financial regulators, as crypto firms seek greater integration with the traditional banking system while regulators remain cautious about the risks. The Federal Reserve's denial of Custodia's master account request reflects its concerns about the potential risks that crypto-related activities could pose to the stability of the US financial system.

The details

In December, Custodia Bank had asked the full US Court of Appeals for the Tenth Circuit to review the split panel ruling that upheld the Federal Reserve's decision to deny the bank's request for a master account. However, the Tenth Circuit denied Custodia's petition for a full court review in a per curiam ruling on Friday.

• The Federal Reserve Board of Governors and the Federal Reserve Bank of Kansas City denied Custodia Bank's request for a master account in a Biden-era decision.
• In December 2022, Custodia Bank asked the full US Court of Appeals for the Tenth Circuit to review the split panel ruling that affirmed the Fed's decision.
• On March 13, 2026, the Tenth Circuit denied Custodia's petition for a full court review.