House Financial Services Committee Ranking Member Maxine Waters (D-Calif.) this week asked the Federal Reserve Bank of Kansas City to provide more information about its decision to grant a cryptocurrency firm a “limited-purpose” master account.
Earlier this month, the Kansas City Fed announced that Kraken Financial has been granted a one-year, limited-purpose account with restrictions and limitations tailored to the company’s business model. The American Bankers Association was among several groups that criticized the decision, noting the Fed is still taking public comment on whether to create “skinny” master accounts for firms like Kraken.
In a letter, Waters said support for competitive access to the payments system is important, but so is ensuring safe and equitable access to financial products and services for consumers. The Kansas City Fed did not disclose details about the agreement, citing confidentiality. Waters requested it clarify the terms of Kraken’s account access approval and provide additional information regarding the process and considerations it used.
“Innovations in payments, digital assets, tokenization and even artificial intelligence are rapidly outpacing statutory frameworks developed to mitigate risk, promote competition and protect consumers in a traditional financial environment,” Waters said. “Given this environment, much is required of those who exercise discretionary authority over safe access to, and operation of, our nation’s critical financial infrastructure.”
