Fed’s Waller Eyes ‘Skinny’ Master Account by Year-End as Crypto Hype Cools

The Federal Reserve is pushing ahead with a limited-access payment account while broader crypto regulation remains stalled.
Industry feedback reveals sharp disagreement over whether non-traditional firms should access Fed infrastructure.
Waller linked regulatory progress with a broader cooling in crypto market sentiment after last year’s surge.

US Federal Reserve (Fed) Governor Christopher Waller said the central bank is targeting implementation of its proposed “skinny master account” before the end of the year, even as wider crypto market legislation remains stalled in Congress. He made the remarks at an event hosted by the Global Interdependence Center, where he discussed the Fed’s ongoing work on digital asset policy.

The proposed account would offer a limited alternative to a traditional master account, which typically grants institutions direct access to the Fed’s payment systems and the US money supply. Under the proposal, eligible institutions would be able to clear and settle payments through selected Fed services but would be excluded from earning interest, accessing intraday credit or borrowing from the discount window.

The Fed said the design is intended to support payments innovation while containing systemic risk, including through balance caps and restrictions on credit access. Public comments on the proposal closed earlier this month, with the Fed receiving 44 submissions reflecting sharp divisions between crypto firms, fintech groups and banking associations.

Related: Crypto Winter Is Here – and It’s Closer to Thawing Than You Think

Industry Split over Fed Access

Crypto and fintech participants largely supported the proposal, arguing it would improve efficiency and reduce reliance on intermediary banks, while community banks and industry groups warned it could weaken longstanding safeguards. The Fed has said it will review the feedback before finalising any rule, a process expected to take several months.

Waller also pointed to a cooling in crypto markets following last year’s post-election surge, describing recent volatility as a routine feature of the asset class. Bitcoin, which reached a high of just over US$126,000 (AU$177,660), has since fallen to around US$70,000 (AU$98,700), illustrating the pullback he referenced.

Related: Lyn Alden Says the Fed’s Next Money-Printing Era Will Be Slow and Subtle, Not a Bitcoin Supercycle

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