Fed Opens Door to Crypto: Proposes 'Skinny' Payment Accounts for Limited Fed-Rail Access.

The Federal Reserve has launched a public consultation on a proposed “payment account” that would allow fintech and crypto-related companies limited direct access to the Fed’s payment systems. Unlike traditional bank master accounts, these accounts would not earn interest, provide access to Fed credit, or grant full banking privileges, and would include restrictions such as balance caps to reduce systemic risk. Fed Governor Christopher Waller supports the initiative as a way to encourage innovation while maintaining financial stability, citing rapid changes in the payments industry. However, some officials, including Governor Michael Barr, have raised concerns about money laundering and terrorism financing risks if non-bank entities gain access without proper oversight. For the crypto sector, the proposal could significantly improve access to the U.S. payments infrastructure after years of regulatory pressure. The Fed is accepting public comments for 45 days, and the system could be operational by late 2026.