Yesterday the US Congressional Research Service (CRS) published a paper about policy issues relating to the Federal Reserve. Around one fifth of the document covered crypto and digital currency topics. It outlined a number of policy questions that Congress might wish to consider. Two related questions were: “Should crypto firms and other nontraditional firms with federal or state bank charters be granted direct access to the Fed’s discount window and master accounts? Should Congress determine who gets access through legislation or defer to the Fed?”
The Congressional Research Service is a non partisan government organization. Hence, it doesn’t propose policy but outlines topics that Congress might wish to consider.
The question regarding master accounts follows the legal battle between Custodia Bank and the Federal Reserve, after the Fed first delayed a response and then refused a master account. Custodia Bank never planned to grant loans, so deposits would be backed one for one and therefore it did not seek FDIC insurance.
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