Custodia loses five-year Fed master account appeal in 7-3 court decision

A federal appeals court ruled against Custodia’s bid for a master account with the Federal Reserve, effectively ending a five-year legal fight. The 7-3 decision comes shortly after the Kansas City Fed approved Kraken for the first-ever crypto master account, marking a contrasting outcome in the industry’s push for direct Fed banking access. Custodia had sought the account to offer banking services to crypto firms, but the court’s decision suggests regulatory hurdles remain significant for smaller custodians seeking Fed privileges.