Fed's Streamlined Master Account Plan for Crypto and Fintech Discussed in Congress

According to ChainCatcher, the U.S. House Financial Services Committee held a hearing on Wednesday to discuss the Federal Reserve's proposed "streamlined master account" plan, which would allow certain crypto banks and fintech companies limited direct access to the Fed's payment system. A master account enables financial institutions to use the Fed's payment network directly; those without one typically rely on correspondent banks.

The debate revealed a divide: community banks expressed concerns that crypto and fintech firms lack equivalent regulatory oversight, posing potential risks to payment system integrity. The crypto industry supported the proposal, citing reduced reliance on intermediaries and innovation benefits. In May, President Trump signed an executive order requiring the Fed to evaluate opening central bank payment rails to fintech and crypto companies. Kansas City Federal Reserve approved a "limited purpose account" for Payward, Kraken's parent company, in March.