The U.S. Tenth Circuit Court of Appeals ruled on November 1, 2025, that Custodia, a Wyoming-based crypto bank, cannot compel the Federal Reserve to grant it master account access.
The decision reaffirms the Federal Reserve’s discretion in refusing master account requests, impacting Custodia’s operations and broader institutional crypto banking in the U.S.
Custodia Bank, led by CEO Caitlin Long, sought access to a Federal Reserve master account to facilitate its crypto-banking services. However, the Tenth Circuit Court of Appeals upheld a lower court’s decision allowing the Fed discretion in account approvals.
The ruling underscores the Fed’s authority to manage risks associated with crypto banking. Custodia faces operational hurdles without a Fed account, which hampers its ability to attract institutional clients in need of payment rails.
Caitlin Long expressed disappointment, stating that “We remain committed to fighting for the right of depository institutions to participate fully in the U.S. financial system. The Fed’s discretionary power leaves innovators at a disadvantage.” Despite industry discontent, the crypto community remains largely unaffected short-term, focusing on decentralized finance solutions.
Did you know? No U.S.-based crypto bank has successfully gained Federal Reserve master account access, reflecting ongoing regulatory hurdles since 2022.
According to CoinMarketCap, Ethereum (ETH) was valued at $3,837.42 with a market cap of $463.17 billion. It showed a 24-hour trading volume of $37.48 billion, down by 7.33%, and experienced a 13.83% rise over 90 days, last updated on November 1, 2025.
Coincu research suggests regulatory challenges persist for crypto banks amid increased scrutiny. The Federal Reserve’s cautious stance on crypto banking implies future regulatory adaptations, impacting the growth of digital asset banking innovations.
