TechFlow news, November 1 — According to CoinDesk, the Tenth Circuit Court of Appeals ruled against crypto bank Custodia, rejecting its application for a Federal Reserve master account. This marks another setback for the company in its years-long legal battle. In its ruling, the court stated that the plain language of the relevant statutes grants the Federal Reserve Banks discretion to deny master account applications from otherwise eligible entities.
Custodia sued the Federal Reserve in 2022, initially claiming the Fed had taken too long to evaluate its application, then amending its complaint after the application was rejected. Custodia argued that the Fed lacks legal authority to deny such applications, but last year a federal judge ruled that the Fed is not required to grant master accounts to every qualified depository institution.
Custodia said it is actively considering petitioning the Tenth Circuit for a rehearing. Previously, Federal Reserve Governor Chris Waller suggested the central bank could design a "streamlined master account" to provide payment system access for crypto firms.
