The Federal Reserve Bank of Kansas City cleared Wyoming-chartered Kraken Financial for a “limited purpose” master account, making it the first crypto bank to access Fed payment rails directly. Banking trade groups immediately objected, arguing the approval “front-runs” the public comment process on the Fed’s proposed “skinny” master account framework. A big fight is brewing.
What you should do: This is a canary in the coal mine. The Fed is moving toward direct payment system access for nonbanks, with or without a finalized policy framework. A world is coming where non-banks will have some sort of direct Fed access. Correspondent banking relationships need to evolve.