Federal Reserve Proposes Restricted Payment Access Framework Following Presidential Directive
The Federal Reserve has put forward a proposal for restricted payment account access designed specifically for cryptocurrency and fintech companies, while simultaneously requesting a temporary halt to Tier 3 account applications as the central bank conducts its comprehensive policy review.
The US Federal Reserve has put forward a proposal to establish restricted payment accounts designed to provide legally qualified fintech and cryptocurrency-affiliated banks with more limited access to its payment infrastructure, without extending the safety net provisions typically available to conventional banking institutions.
The framework was unveiled on Wednesday via a Federal Reserve Board request for public commentary and notice of proposed rulemaking, which references "skinny master accounts" intended for nonbank financial institutions.
The Fed has also recommended that regional Reserve Banks temporarily suspend their decisions regarding Tier 3 account-access applications while the rulemaking process reaches completion, a timeline that staff members indicated should conclude no later than Dec. 31, 2026.
The temporary pause will allow the Federal Reserve to solicit and consider public input on payment accounts and to promote consistent implementation.
This development underscores the continuing regulatory friction surrounding cryptocurrency access to US payment infrastructure in the wake of President Donald Trump's executive order advocating for expanded fintech and digital asset integration, even as the Fed pursues a more measured and conservative strategy.
Tier 3 pause expected to end by Dec. 31
According to a Board memo, the Fed anticipates that its temporary suspension of Tier 3 master account applications will conclude on or before Dec. 31.
The memo additionally contained a roster of "pending account requests" from Tier 3 institutions as of Feb. 28, 2026. Among the entities on the list were companies such as Kraken Financial, which serves as the banking division of cryptocurrency exchange Kraken.
Kraken subsequently received approval for a limited-purpose master account from the US Federal Reserve Bank of Kansas City in early March 2026. The bank granted the access specifically under a Tier 3 classification.
Trump order and limits on direct Fed access by crypto
The cryptocurrency sector has persistently sought access to Fed master accounts as a mechanism to establish more direct connectivity to the US payment infrastructure.
The most recent proposal stops short of granting crypto exchanges direct access, despite the existence of wider political backing for expanding fintech and digital asset entry to the financial ecosystem.
While Trump's executive order indicated support for broader fintech and digital asset integration, direct access to master accounts would remain unavailable to crypto exchanges. Rather, companies would be required to operate through an affiliated entity that meets the criteria as an eligible depository institution under the Federal Reserve Act, according to Eleanor Terrett.
The framework for "skinny" payment accounts was initially presented in October by Federal Reserve Governor Christopher Waller and underwent further refinement through policy deliberations in early 2026.
In contrast to master accounts, the proposed payment accounts would be restricted to clearing and settlement functions exclusively. They would not generate interest or offer access to central banking instruments such as the discount window or intraday credit facilities.