Accelerated mode for payment accounts: The Federal Reserve has opened the door for banks dealing with cryptocurrencies

The shift in narrative regarding cryptocurrency is gaining momentum. The Federal Reserve has solicited public comments on a new proposal — a simplified “payment account” dedicated to financial institutions operating in the digital assets sector. This would represent a breakthrough in the regulator’s previously strict approach to this area.

What exactly will this new account be?

The proposed payment accounts will provide access to Fed infrastructure but will operate under simplified rules. They will not be equivalent to full primary accounts — they will not offer interest, access to Fed credit, or the same privileges as standard bank accounts. Additionally, they may be subject to balance limits.

Importantly, this solution opens an expedited approval process for cryptocurrency banks seeking access to Fed payment systems and the ability to operate at the federal level. This would be a significant shift in the central bank’s stance.

Who is behind this initiative?

The concept of a “slimmed-down” account originates from Federal Reserve Board member Christopher Waller, who first introduced it in October. Waller emphasized in a statement: “These new payment accounts will support innovation while maintaining the security of the payment system. This request for information is a crucial first step to ensure that the Fed responds to changes in how payments are made.”

A long road to this moment

For years, crypto banks — such as the state-licensed Custodia — have unsuccessfully sought primary accounts. The Federal Reserve has consistently rejected such applications, claiming they would pose a threat to the stability of the U.S. financial system. This approach was maintained even at the end of the previous administration.

However, the political landscape is changing. In light of amendments and the removal of many barriers separating traditional finance from the crypto sphere, the issue of access for digital banks has once again come to the forefront.

What does this mean for the future?

The 45-day public consultation process could open the door for the expansion of the cryptocurrency banking sector in the United States.

At the same time, plans for payment accounts signal that the new Fed leadership — particularly Christopher Waller, the leading candidate to succeed outgoing Chair Jerome Powell — shows a much greater willingness to change the doctrine regarding digital assets. This would contrast with the more restrictive approach of the previous term.

If the proposal passes, it could be a groundbreaking moment for the U.S. cryptocurrency ecosystem.