The US Federal Reserve has denied a request from cryptocurrency financial institution Custodia Financial institution to rethink its membership software to the Federal Reserve System.
The Fed introduced its denial on Feb. 23 saying the Federal Reserve Board beforehand determined that Custodia’s software “was inconsistent with the required elements underneath the regulation.”
@federalreserve publicizes it has denied the request by Custodia Financial institution, Inc., for reconsideration of the Board’s resolution final month on its software to be supervised by the Federal Reserve: https://t.co/ZYNUEoLeN1
— Federal Reserve (@federalreserve) February 23, 2023
In January, the Fed rejected Custodia’s software to turn out to be a member. Board guidelines permit candidates to request a reconsideration of membership choices.
On the time of the preliminary rejection, the Fed claimed Custodia had an “inadequate” administration framework.
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It additionally cited a joint declaration it made alongside the Federal Deposit Insurance coverage Company (FDIC) and Workplace of the Comptroller of the Foreign money (OCC) that claimed cryptocurrencies have been “inconsistent with protected and sound banking practices.”
Custodia has mentioned it needs to hitch the Federal Reserve System so it may be regulated underneath the requirements that apply to conventional banks and open a path for different crypto-banks that want to be held to those self same heightened requirements.
