Finance13 August, 20262 min read
Blockchain Association Backs Custodia Bank’s Supreme Court Bid After Fed Denies Master Account
This article is an automated aggregation of coverage from news outlets. Our editorials offer in-depth analysis curated by the NewsCord team.
Blockchain Association filed an amicus brief urging Supreme Court to review Fed master account denial. It argues whether regional Fed banks can deny master accounts to qualified state-chartered banks.
Fed access fight
The Blockchain Association filed an amicus brief supporting Custodia Bank’s petition for U.S. Supreme Court review after the Federal Reserve denied Custodia’s master account application, a dispute that centers on whether the Fed can use banking access to squeeze digital-asset firms.
Reuters and other outlets in the record describe Custodia as a Wyoming-based crypto bank seeking a Federal Reserve “master account” that would let it settle payments directly with the central bank, after an appeals panel ruled in October that eligibility alone did not entitle it to an account.
The Blockchain Association argued in its Wednesday filing that a lower-court ruling in favor of the Fed gives federal regulators “a quiet way to cut lawful businesses out of the banking system,” and it framed the case as shaping “how much power federal regulators have over state-chartered banks.”
The brief also invoked “Operation Choke Point 2.0,” saying the prior administration “used vague rules, excessive discretion, informal guidance, and aggressive enforcement actions to pressure banks away from serving digital asset clients.”
Court timeline and allies
Custodia’s fight has unfolded across multiple courts, with the Kansas City Fed denying its master account application in January 2023 and Custodia later asking the full Tenth Circuit to rehear the case in December.
The Block reported that Custodia petitioned the Supreme Court after a 7-3 decision in March 2026, and it said the Kansas City Fed is due to respond to Custodia’s petition by Sept. 11.
The Blockchain Association’s position was echoed in other coverage, including Crypto News, which said the industry group warned that lower-court rulings could give federal regulators “unchecked power to restrict banking access for lawful industries.”
In the same reporting thread, Crypto News also quoted the association’s X framing that “No lawful industry should be excluded from essential banking services through regulatory pressure or unchecked administrative discretion,” tying the legal question to competition and access to payment infrastructure.
What’s at stake
The dispute is presented as more than a single bank’s access, with the Blockchain Association warning that if the lower court rulings stand, federal regulators could effectively debank disfavored industries without interference from state regulators. Decrypt described the association’s argument that federal regulators could override state banking decisions by denying access to the payments system, and it framed the question as “Whether federal regulators, based on their own discretionary whims, can intrude on state prerogatives and debank lawful businesses.”
Cointelegraph added that the case comes as other crypto firms gain greater access to the U.S. banking system, noting that in March Kraken Financial became the first crypto banking unit to receive a limited-purpose master account from the Federal Reserve Bank of Kansas City. In that same context, Cointelegraph contrasted Kraken’s approval with Custodia’s rejection by the same regional Fed bank in 2023, making the master-account access question a live benchmark for how crypto-focused institutions connect to Fedwire and other central-bank payment rails.