The U.S. Federal Reserve has proposed a fast-track approval process for banks offering “innovation-driven” services and aiming to operate nationwide. This initiative is designed to facilitate national registration and operations for banks active in the cryptocurrency and fintech sectors. The proposal involves creating a master account, termed the “skinny master account,” which would grant these innovative banks access to basic financial services with a less complex and more limited scope compared to traditional banks. This arrangement allows banks to provide services without holding a full banking license while remaining under Federal Reserve supervision.
Given the growing use of cryptocurrency and blockchain technology, integrating innovation into the banking system and mainstreaming new financial models has been challenging. Many crypto banks have sought inclusion in the traditional banking system but faced difficulties due to stringent regulatory requirements. The Federal Reserve’s proposal represents a positive step toward bringing these banks within a legal and regulatory framework. However, the plan also raises potential risks and challenges, particularly concerning financial stability and consumer protection. To address these concerns, the Federal Reserve has invited public feedback to consider the views of various stakeholders.
This move is viewed as a significant advancement in integrating cryptocurrency into the U.S. financial system and promoting fintech innovation, with the potential to shape the future of banking.
Source: decrypt
