Digitalasset bank Custodia denied membership in the U.S. Federal Reserve System.
According to the decision announced Friday, the application submitted by the digital asset bank is inconsistent with legal requirements.Crypto bank Custodia has been denied membership in the United States Federal Reserve System. In an announcement dated Jan. 27, the Federal Reserve Board explained that the application, as submitted by the company, is “inconsistent with the required factors under the law.
The firm’s novel business model and proposed focus on crypto-assets presented significant safety and soundness risks. “In light of these and other concerns, the firm’s application as submitted was inconsistent with the factors the Board is required to evaluate by law,” the body concluded in the statement, adding that the order will be released following a review for confidential information.
Custodia offered a safe, federally-regulated, solvent alternative to the reckless speculators and grifters of crypto that penetrated the U.S. banking system, with disastrous results for some banks.
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