US Lawmaker Questions Federal Reserve Over Kraken Master Account Approval

US Representative Maxine Waters has requested detailed information from the Federal Reserve Bank of Kansas City regarding the approval of a limited-purpose master account granted to Kraken Financial. The request highlights growing scrutiny over crypto firms gaining direct access to the U.S. financial infrastructure.

Federal Reserve Access Raises Regulatory Questions

In a letter addressed to Kansas City Fed President Jeff Schmid, Waters asked for clarification on what services Kraken can access and what restrictions apply. She also requested details about anti-money laundering checks and consumer protection safeguards reviewed before approval.

The limited-purpose master account provides access to Fedwire, allowing transactions through the same payment network used by banks and credit unions. However, officials noted that specific operational details remain confidential due to business privacy rules.

Calls for Transparency in Crypto Banking Access

Waters argued that granting payment system access to crypto firms introduces regulatory and policy concerns that require full transparency. She emphasized that digital asset innovation, including tokenization and artificial intelligence tools, is advancing faster than existing laws designed to manage financial risks.

Several crypto-related institutions, including Custodia Bank, Anchorage Digital Bank, and Ripple, have also sought similar Federal Reserve account access, signaling continued industry efforts to integrate with traditional payment systems.

Disclaimer

This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.