In a move that could recalibrate how nonbank players—and by extension crypto-linked firms—interact with the U.S. payments system, the Federal Reserve on Wednesday unveiled a proposal to issue limited payment accounts, tentatively dubbed “skinny master accounts.” These accounts would let legally eligible fintechs and crypto‑linked banks access Fed payment rails for clearing and settlement, but without the broader, backstopped features enjoyed by traditional banks. The proposal arrives as the Fed opens a public comment period and initiates a rulemaking process, signaling a measured, cautious approach to broadening direct access while preserving core safety and supervisory standards. Concurrently, the Fed asked regional Reserve Banks to pause decisions on Tier 3 account‑access requests while the rulemaking unfolds, a pause staff say is intended to ensure consistent implementation and to incorporate public input. The pause is expected to last until the rulemaking concludes, with a target e...

The U.S. Federal Reserve is advancing a framework to provide limited payment accounts to certain nonbank financial institutions, including fintechs and crypto-linked banks, enabling narrower access to the Fed’s payment rails without the full backstops afforded to traditional banks. The proposal, issued as a notice of proposed rulemaking, signals a cautious approach to widening direct Fed access for the crypto and fintech sector. According to Cointelegraph, the plan would introduce “skinny master accounts” that can clear and settle payments but would not earn interest or provide access to central banking tools such as the discount window or intraday credit. The Fed also directed regional Federal Reserve Banks to pause decisions on Tier 3 account-access requests while the rulemaking proceeds, a pause staff expect to conclude by December 31, 2026. Key takeaways The Fed proposes skinny payment accounts for legally eligible fintechs and crypto-linked banks, offering narrowed access to pay...

Tax evaders are increasingly turning to Bitcoin Ordinals, BRC-20 tokens, and related on-chain techniques to hide wealth, according to a report from blockchain analytics firm Chainalysis. The firm warns that as digital assets become more mainstream, malefactors “frequently attempt to exploit novel technologies” in the hope of evading tax authorities and law enforcement. The development comes amid a broader push by tax agencies to catch up with rapid advances in crypto and blockchain tech. In a notable Italian case highlighted by Chainalysis, authorities allege that a suspect used Ordinals and the BRC-20 standard to conceal 1 million euros in undeclared capital gains. The investigation, led by Italy’s Economic and Financial Police Unit in Foggia, reveals how on-chain inscriptions and tokenization can be deployed to create and move assets without immediate visibility to traditional tax reporting channels. Chainalysis described the sequence as the creation of tokens via the Ordinals protoc...

The former Silvergate Bank chief risk officer has shed new light on the bank’s winding-down and the terms of a 2024 SEC settlement, saying she agreed to a civil penalty and a multi-year ban to avoid a protracted court battle over assertions that the bank misled investors about its anti-money-laundering rules and how it monitored crypto customers. In her first public remarks since the settlement, Kate Fraher indicated that no regulator had proven AML controls had failed, and that she chose to settle to “move forward.” Fraher’s disclosures come as the U.S. securities regulator’s enforcement stance on the crypto sector continues to shape the industry’s access to traditional banking services. The former executive confirmed that the SEC’s action led to a civil penalty of $250,000 and a five-year ban from serving as a company executive or board director. She also highlighted the personal toll of the enforcement process, noting that she was de-banked and faced immediate credit-line closures a...

A bipartisan group of U.S. lawmakers has introduced the Digital Asset Protection, Accountability, Regulation, Innovation, Taxation and Yields Act, known as the PARITY Act. The measure would direct the Treasury Department to study how a de minimis exemption for digital assets might be structured and applied, signaling a cautious approach to tax policy amid a rapidly evolving crypto landscape. The PARITY Act was introduced in the House after lawmakers published a discussion draft in March. Republican Representative Max Miller, who helped shepherd the bill, framed the move as a recognition that the tax code has struggled to keep pace with innovations in digital assets and financial technology. Democratic Representatives Steven Horsford and Suzan DelBene, along with Republican Representative Mike Carey, are among the bill’s sponsors. The timing comes as Congress READIES further consideration of crypto regulation, with the Senate preparing to debate a broader framework for how U.S. market r...

The U.S. Securities and Exchange Commission is pausing the rollout of a new wave of “novel ETFs,” including those designed to let investors bet on the outcomes of real-world events, so regulators can weigh their implications before approving them. In a Wednesday statement, SEC Chair Paul Atkins said that “novel products raise novel questions” and directed the agency’s staff to solicit public feedback on how to respond to these applications. The pause comes as Bitwise filed in February for a series of prediction-market ETFs under the PredictionShares brand to track U.S. election results, with Roundhill Investments and GraniteShares also pursuing prediction-market ETF filings in the same month. Prediction markets have surged in crypto discourse over the past year and a half, evolving into a notable use case within the space. Analysts note the regulatory attention surrounding these instruments as they move toward traditional market structures. Prediction markets—where participants trade c...

Missouri has filed a civil lawsuit against GPD Holdings, the operator behind CoinFlip’s network of crypto ATMs, accusing the company of knowingly facilitating fraudulent transactions and profiting from them. The action represents one of the most prominent state-level efforts to police crypto kiosks as regulators widen scrutiny over how digital-asset services interact with everyday consumers, including seniors and veterans who may be particularly vulnerable to scams. The Missouri Attorney General’s Office, in a filing disclosed this week, seeks a wide-ranging remedy under the Missouri Merchandising Practices Act. The petition asks the court to declare CoinFlip’s practices unlawful, to enjoin the company from operating within Missouri, to impose civil penalties of $1,000 per violation for the past five years (potentially up to $1.826 million), and to award restitution to affected consumers. The office framed the case as part of a broader concern about the integrity of crypto kiosks and t...