Fed Governor Waller Proposes Limited Master Accounts for Stablecoin Issuers and Fintechs

• Skinny master accounts provide limited Fed access for non-bank entities like crypto firms.

• They enable direct payment settlements, bypassing intermediary banks for efficiency.

• Eligibility follows existing legal standards, excluding lending or discount window features, as announced in 2025.

Discover how Fed’s skinny master accounts revolutionize crypto access to payments. Legally eligible fintechs gain direct rails—stay ahead in digital finance evolution.

What are skinny master accounts proposed by Governor Waller?

Skinny master accounts are a new type of limited-access Federal Reserve accounts designed for legally eligible non-bank institutions, including fintech companies and stablecoin issuers. Announced by Governor Chris Waller at the Federal Reserve’s Payments Innovation Conference on October 21, 2025, these accounts allow direct connection to the Fed’s payment rails for settlement purposes. Unlike traditional master accounts, they exclude borrowing or emergency lending privileges, focusing solely on efficient transaction processing.

How will skinny master accounts benefit digital asset firms?

This proposal addresses long-standing barriers for crypto custodians and fintechs seeking direct Fed access. Firms like Custodia Bank and Kraken Financial have faced delays in applications, with Custodia even pursuing legal action against the Fed. By granting settlement capabilities, skinny master accounts could accelerate stablecoin adoption and tokenized asset transactions. Waller emphasized that “every legally eligible entity could get one,” maintaining current eligibility criteria under U.S. law. According to reports from former Fox Business journalist Eleanor Terrett, this framework supports innovation without compromising financial stability. Experts note that such access could reduce reliance on intermediary banks, lowering costs and enhancing speed for blockchain-based payments. Data from the Fed indicates that direct access could cut settlement times from days to seconds, fostering integration between traditional and digital finance systems.

Governor Waller unveils limited-access “skinny master accounts” offering legally eligible fintechs and stablecoin issuers direct Fed payments access, without lending or discount-window privileges.

At the Federal Reserve’s Payments Innovation Conference on Tuesday, Governor Chris Waller announced plans for a new category of limited-access “skinny master accounts,” according to former Fox Business journalist Eleanor Terrett.

The framework would allow all legally eligible institutions, including fintech firms, stablecoin issuers, and crypto custodians, to connect directly to the Fed’s payment rails without relying on intermediary banks.

Waller explained that these accounts would not grant access to every service of a traditional master account, such as borrowing privileges or emergency lending. 

However, they would provide direct settlement capabilities, a privilege long reserved for licensed banks. “Every legally eligible entity could get one,” Waller said, emphasizing that eligibility rules under existing law would remain unchanged.

A potential breakthrough for digital asset institutions

The proposal could mark a turning point for firms that have faced years of regulatory friction, including Custodia Bank and Kraken Financial, both of which have sought direct Fed access.

Custodia even filed a lawsuit against the central bank over its prolonged application process. Other companies like Ripple and Anchorage Digital, which submitted applications earlier this year, could also benefit if the new model is approved.

The proposal quickly caught the crypto sector’s eye. By giving nontraditional firms direct Fed access, it could fast-track stablecoins and tokenized settlements into the U.S. financial system, a move blurring the line between banks and blockchains.

Also read: US Fed to Discuss Bitcoin, Crypto at Payments Conference

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Frequently Asked Questions

What eligibility criteria apply to skinny master accounts?

To qualify for a skinny master account, institutions must meet existing Federal Reserve standards for legal eligibility, such as being supervised or regulated entities. This includes fintechs, stablecoin issuers, and crypto custodians that comply with anti-money laundering rules and other financial safeguards, ensuring only vetted players gain access.

Why is direct Fed access important for stablecoin issuers?

Direct access through skinny master accounts allows stablecoin issuers to settle transactions instantly on the Fed’s secure rails, reducing counterparty risks and operational costs. This integration supports faster, more reliable digital payments and positions stablecoins as viable alternatives in everyday finance, as highlighted by Governor Waller’s announcement.

Key Takeaways

• Skinny master accounts expand Fed access: They offer settlement-only privileges to non-banks, promoting efficiency in payments.
• Regulatory clarity for crypto firms: Eligible entities like stablecoin issuers can bypass intermediaries, addressing past application hurdles.
• Future of finance innovation: This proposal bridges traditional banking and blockchain, encouraging tokenized asset growth—monitor Fed updates for implementation timelines.

Conclusion

Governor Chris Waller’s introduction of skinny master accounts represents a significant step toward inclusive financial infrastructure, enabling fintechs and digital asset firms direct Fed payment access under strict eligibility rules. By focusing on settlements without broader banking features, the initiative balances innovation with stability. As the crypto ecosystem evolves, this could pave the way for broader stablecoin integration—financial professionals and investors should watch for regulatory developments to capitalize on emerging opportunities.