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A US appeals court moved ahead to reject a request submitted by Custodia Bank to reconsider its legal challenge against the Federal Reserve. The push was over the access to the central bank’s payment system. The dismissal marks another setback in the bank’s long-running attempt to obtain a master account. The United States Court of Appeals for the Tenth Circuit voted 7–3 against granting Custodia’s petition for a rehearing before the full court. The request was filed to overturn an October ruling that Reserve Banks have legal discretion to deny master accounts to institutions that are seeking direct access to the Fed’s payment infrastructure. Fed misread the Monetary Control Act? On Dec 15, 2025, Custodia filed its petition for rehearing. It argued that the panel misinterpreted the Monetary Control Act of 1980. The bank mentioned that the law grants eligible institutions the right to a master account. However, it also warned that the earlier ruling undermined state banking authority while raising constitutional concerns. In a split view, Judge Timothy Tymkovich stated that the case carried major implications for financial regulation. He even argued that allowing Reserve Banks unreviewable discretion over master account approvals could conflict with federal statutes and potentially the Constitution. As of now, Custodia hasn’t issued any statement. But it is expected that the bank might continue to pursue access to the Fed’s payment system. 🚨NEW: The 10th Circuit has rejected @custodiabank’s request for a full court rehearing in its master account fight with the @federalreserve, after a panel ruled in October that Reserve Banks have legal discretion to deny master account access. Active judges voted 7–3 against… https://t.co/SXE4qf5TBH pic.twitter.com/O9pQ9zrH5h — Eleanor Terrett (@EleanorTerrett) March 13, 2026 The decision comes in when another crypto-linked institution moves closer to the US financial system. Recently, Kraken announced that it had…

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Filed under: News - @ March 13, 2026 11:26 pm