What are “skinny” Fed accounts in crypto?

“Skinny” Fed accounts refer to limited-access payment accounts that allow firms to clear and settle transactions directly through Federal Reserve infrastructure. Crypto companies have long pursued them to reduce settlement costs and reliance on intermediary banks.

Why do crypto firms want access to Federal Reserve payment rails?

Direct access to Fed payment systems could make transactions faster, cheaper and more efficient for crypto firms. It may also improve stability and reduce dependence on traditional banking partners.

What restrictions would apply to these limited accounts?

The proposal says account holders would not receive intraday credit, discount-window borrowing access or interest on balances held at Reserve Banks. Automated controls would also prevent overdrafts and limit operational risk.

How are these accounts different from full master accounts?

Full master accounts provide banks with broader access to central banking services and liquidity support. The proposed limited accounts would only allow restricted payment and settlement functions.

Why is this proposal important for the crypto industry?

Many crypto firms have struggled to secure stable banking access in the United States. Limited Fed accounts could provide more direct integration with the traditional financial system while improving payment infrastructure access.

Why is the Federal Reserve seeking public comments?

The Federal Reserve opened a 60-day comment period to gather feedback on how the framework should operate and what safeguards may be needed. Regulators revised parts of the proposal after earlier industry input.

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Federal Reserve revives limited crypto payment accounts

Written by Heidi Cuthbert Published May 21, 2026, 4:01 AM

The Federal Reserve proposed a new framework for limited payment accounts that could give crypto firms and non-bank financial companies restricted access to central bank payment infrastructure without full master-account privileges.

The proposal opens a 60-day public comment period and revives the concept commonly referred to within the crypto sector as “skinny” Fed accounts, which have long been sought by digital asset companies seeking cheaper and faster payment settlement access.

Under the proposal, approved firms would be able to clear and settle payments through Federal Reserve systems but would not receive key banking privileges such as access to intraday credit, discount-window borrowing or interest on balances held at Reserve Banks.

The Federal Reserve said account holders would also face automated controls designed to prevent overdrafts and limit payment activity exposure.

The latest proposal follows an earlier request for information issued in December and incorporates changes after industry feedback, including higher maximum closing balance limits tied to expected payment activity.

The initiative comes after Kraken became the first crypto-focused bank to receive a limited master account through the Federal Reserve Bank of Kansas City earlier this year.

Separately, Donald Trump signed an executive order directing the Federal Reserve to review how uninsured depository institutions and non-bank financial firms gain access to payment accounts and central banking services.

The proposal highlights growing pressure on US regulators to clarify how crypto firms can interact with core banking infrastructure as digital asset companies continue pushing for more direct access to federal payment systems.