Fed Seeks Comment on Limited ’Payment Accounts’ to Let Crypto Banks Access Fed Rails
The Federal Reserve has proposed creating limited "payment accounts" that give innovation-focused and crypto banks streamlined access to Fed payment rails without full master-account privileges. The 45-day public comment proposal — informed by ideas from Governor Christopher Waller — would bar interest on balances, exclude discount-window credit, and may impose balance caps and other limits to reduce systemic risk. The move aims to speed fiat on/off‑ramps, improve settlement speed and reduce intermediaries for crypto custodians and fintech banks while maintaining safeguards against market volatility and contagion. Key operational benefits for crypto firms include faster settlements, lower operational costs and closer oversight; key constraints include no interest on reserves and restricted access to Fed credit, which limit changes to system liquidity. The proposal is open for stakeholder feedback and could materially alter banking relationships for crypto companies and indirectly influence market liquidity and trading flows depending on final rules.
Neutral
The proposal is unlikely to directly move crypto token prices in the short term because it expands operational access rather than injecting liquidity or altering monetary policy. For traders, the announcement is neutral overall: positive operational effects (faster settlement, improved fiat rails, fewer intermediaries) could marginally improve market efficiency and reduce frictions over time, which is mildly bullish for crypto market functioning. However, explicit constraints — no interest on balances, no discount-window access, possible balance caps and other limits — curtail systemic liquidity transmission and reduce the chance of a major liquidity-driven price rally. Short-term price reactions may be muted or driven by interpretation of final rule details; long-term, if rules materially lower custody/friction costs and broaden bank relationships, the structural improvement to fiat on/off‑ramps could support higher institutional participation and liquidity, a mild bullish factor. Overall, net near-term price impact is neutral with potential mild long-term upside to market structure.