Blockchain Group Backs Custodia Bank's SCOTUS Bid
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- The Blockchain Association filed an amicus brief on Wednesday supporting Custodia Bank's petition for Supreme Court review of its dispute with the Federal Reserve over a master account.
- Custodia Bank, a Wyoming-based crypto bank offering digital-asset custody, payments, settlement infrastructure, and stablecoin-related products to institutional clients, has spent years seeking a master account to settle payments directly with the central bank.
- A Tenth Circuit appeals panel ruled in October that eligibility alone did not entitle Custodia to an account; Custodia asked the full Tenth Circuit to rehear in December.
- The Blockchain Association argued the lower ruling lets federal regulators override state banking decisions by denying payments-system access, threatening the dual banking system where both state and federal authorities can charter banks.
- The brief characterized Custodia's fight as the latest phase of "Operation Choke Point 2.0," alleging the prior administration used "vague rules, excessive discretion, informal guidance, and aggressive enforcement actions" to pressure banks away from serving digital asset clients.
- The Supreme Court has not yet agreed to hear the case.
Why it matters: Custodia has spent years seeking direct Fed settlement access. If the Supreme Court lets the lower ruling stand, federal regulators retain broad discretion to deny master accounts to state-chartered crypto banks, effectively letting the Fed 'debank' without formal rulemaking. A Custodia win would force eligibility-based account decisions and constrain the Fed's policy-driven denials.
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