The Federal Reserve has launched a request for information on prototype “payment accounts” for eligible banks, with 45 days for public feedback. The initiative follows Federal Reserve Governor Christopher Waller’s proposal two months ago for a streamlined alternative to traditional master accounts, designed to fast track access for banks by late 2026.
However, the proposal faces internal opposition. Fed Governor Michael Barr expressed concerns about anti-money laundering protections, noting the Federal Reserve will not supervise most banks using these accounts. The debate carries particular significance for institutions like Wyoming’s Custodia Bank, which caters to the digital asset sector and has waged a yearslong legal battle with the Fed over master account access. For stablecoin issuers it could significantly smooth the on- and off-ramping process.
The payment accounts would impose substantial restrictions compared to traditional master accounts. As Waller outlined in his October speech, banks could only use the accounts for their own clearing and settlement purposes, explicitly excluding correspondent banking or other services.
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