Custodia Bank Takes Fed Master Account Fight Toward Supreme Court

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Custodia Bank has secured additional time to bring its dispute with the Federal Reserve before the US Supreme Court. Justice Neil Gorsuch granted the bank’s motion for an extension of time to file its certiorari petition. The Wyoming-chartered digital asset bank now has until July 11, 2026, to file its appeal. The petition challenges the Federal Reserve’s denial of a master account, per Supreme Court docket 25A1320. Background to the Fed Account Denial Custodia, founded by Caitlin Long, applied for a Kansas City Fed master account in October 2020. The Fed formally denied the application in January 2023. Officials cited safety and soundness concerns tied to the crypto-focused business model. A divided 10th Circuit panel ruled 2-1 in October 2025 that Reserve Banks retain discretion over master account access. The decision interpreted the Federal Reserve Act as granting the Federal Reserve authority to approve or deny eligible institutions. A 7-3 vote denied en banc rehearing in March 2026, prompting Custodia to seek Supreme Court review. What a Supreme Court Review Would Decide At stake is the Monetary Control Act of 1980. Custodia argues it requires Reserve Banks to provide equal payment access to eligible nonmember institutions. The Fed counters that the statute addresses pricing once services are provided, not entitlement to accounts. Banking trade groups have supported the Fed’s reading in amicus filings before the lower courts. A Supreme Court decision in Custodia’s favor could limit the Fed’s ability to deny master accounts to statutorily eligible institutions. The outcome would carry implications for fintech firms and crypto-native banks seeking direct access to Fedwire and ACH. A denial of certiorari would instead affirm the Federal Reserve’s broad authority over payment system entry. Custodia is represented by Kannon K. Shanmugam of Davis Polk. Whether the Court grants review remains uncertain, given the high bar that statutory interpretation cases face.

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