Trump Order Puts Fed Master Accounts at Center of Crypto Payment Access Fight
President Trump signed an executive order directing the Federal Reserve and other regulators to review barriers that keep crypto and fintech firms out of U.S. payment rails. The Fed has 120 days to deliver a formal report to the White House, and the order follows Kraken's March approval for a limited-purpose Fed account.
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What the Executive Order Directs
President Trump signed an executive order on Tuesday, titled "Integrating Financial Technology Innovation into Regulatory Frameworks," instructing the Federal Reserve and other federal financial regulators to identify rules that "unduly impede" fintech firms from partnering with federally regulated institutions. Agency heads have three months to complete that audit. The Fed was given 120 days to deliver a formal report to the White House.
The order focuses on master accounts, the access points to payment systems such as Fedwire, which handles high-value dollar settlement. Those accounts have historically been limited to licensed depository institutions, which has pushed crypto companies seeking direct access toward state or federal bank charters. The order asks the Fed to evaluate whether its framework can be extended to non-bank fintech and crypto firms.
The Regional Bank Question
The order also asks the Fed to clarify whether its 12 regional Reserve Banks can approve or deny master account applications without direction from the Board of Governors in Washington. Reporting on that point is precise about the stakes: if regional banks can act independently, applicants could in principle pursue the most receptive branch.
This is not hypothetical. In March, the Kansas City Fed approved a limited-purpose account for Payward, the parent company of Kraken, making it the first crypto exchange to receive any form of Fed payment access. Kraken co-CEO Arjun Sethi described the arrangement as the "convergence of crypto infrastructure and sovereign financial rails." The Bank Policy Institute, which represents large U.S. banks, said it was "deeply concerned" that the approval came before the Fed had finalized a broader policy framework.
Community Banks Push Back
Rebecca Romero Rainey, president and CEO of the Independent Community Bankers of America, said the order exposes "significant gaps in regulation" between banks and non-bank entities. She called for the Fed to pause new policies on stablecoins, master accounts, and trust charters until their combined impact can be assessed. "Like activities should be subject to like regulation," she said.
The Fed's Pending Framework
The Fed had already been working toward its own answer. In December it proposed "skinny" master accounts, restricted accounts that would provide payment system access while excluding interest on reserves and discount window borrowing. Crypto firms and community banks have responded to that proposal in opposing directions, each pressing for rules that favor their position. The executive order adds a federal deadline to a process that had been moving slowly, and places a political timeline on an institution that guards its independence.
Why It Matters
For Traders
Exchanges and tokens with fiat rails at stake could see sentiment swing on the Fed's 120-day report, but no outcome is set before that deadline.
For Investors
Direct Fed payment access for crypto firms would be a structural shift in U.S. market plumbing, and the regional-bank question will determine how far that access can spread.
For Builders
Firms building on settlement and stablecoin rails should track whether skinny master accounts become available to non-bank applicants, since that would change their counterparty and custody options.
This article is for information only and is not financial advice. Read the full disclaimer.
