1. QiAi QuestsHome
  2. Daily Digest

Federal Reserve Board rejects crypto bank application for supervision

• Daily Digest • 83 views

It is reported that the Federal Reserve Board of the United States recently announced that after rejecting the application last month, it again rejected the ap…

Federal Reserve Board rejects crypto bank application for supervision

It is reported that the Federal Reserve Board of the United States recently announced that after rejecting the application last month, it again rejected the application of Custodia, a cryptobank, for the supervision of the Federal Reserve. A press release said that the Board of Directors of the Federal Reserve voted against reconsidering Customia’s application.

Cryptobank Custodia’s application for Federal Reserve supervision was rejected again

Interpretation of the news:


The United States Federal Reserve Board announced that it has rejected the application of Custodia, a crypto bank, for supervision, which marks the second time within a month. The news comes as a surprise for the crypto industry and will hinder Custodia’s plans to operate as a regulated bank.

Custodia is a start-up company that provides secure digital asset custody solutions to institutional clients, including cryptocurrency exchanges, miners, and financial institutions. The company had applied for the Federal Reserve Board’s supervision, which would give it a route into the traditional banking system, enabling it to offer more financial services to its clients. However, the Federal Reserve Board once again rejected the application, citing unspecified reasons.

The denial of Custodia’s application comes when the cryptocurrency market is booming, and institutional adoption is surging. Some experts believe that the centralized control of traditional financial institutions is clashing with the decentralized nature of cryptocurrencies. As such, the Federal Reserve Board’s decision reflects the conservative approach of traditional financial institutions towards the adoption and regulation of cryptocurrencies.

This move by the Federal Reserve Board signals that crypto businesses need to collaborate further with the regulators to be accepted into the mainstream financial world. The denial could also result from deficiencies in the management and compliance structure of Custodia, as traditional financial institutions have clear-cut criteria for regulations purposes.

In conclusion, the Federal Reserve Board’s second rejection of Custodia’s application for supervision is a setback to the crypto banking industry that aims to integrate with the traditional financial landscape. The denial points to the growing pains of a new industry as traditional financial regulators try to find ways to adapt to emerging technologies. The decision highlights the need for crypto businesses to collaborate and comply with traditional regulators to be accepted into the mainstream financial world.

This article and pictures are from the Internet and do not represent qiAiAi's position. If you infringe, please contact us to delete:https://www.qiaiai.com/daily/2953.html

It is strongly recommended that you study, review, analyze and verify the content independently, use the relevant data and content carefully, and bear all risks arising therefrom.

Like (0)
Previous 02/23/2023 23:59
Next 02/24/2023 00:17

Related recommendations