US Representative Maxine Waters is demanding transparency from the Federal Reserve regarding its approval of a master account for Kraken’s banking unit. In a letter to the Kansas City Fed, Waters requested details on the account’s practical implications, access conditions, and risk mitigations by April 10. This approval, seen as a milestone for crypto firms seeking direct access to federal payment rails, has sparked concerns over policy and consumer protection oversight.
Ranking Democrat on the House Financial Services Committee, Maxine Waters, has formally requested answers from the Federal Reserve Bank of Kansas City concerning its approval of a master account for Kraken Financial. She asked President Jeff Schmid to clarify the account’s specific access and restrictions by April 10.
The limited-purpose master account grants Kraken’s banking unit potential access to the Fed’s core payments system, Fedwire. This direct access is a pursued goal for several US crypto companies but was granted with limited public disclosure. “The Kansas City Fed’s announcement does not disclose specific information about Kraken’s access to the range of Federal Reserve financial services due to the confidentiality of business information provided by applicants,” Waters wrote.
She argued that such access raises significant policy and consumer protection concerns requiring full transparency. “Answers to these questions are critical to ensuring that the process… is conducted consistently with the law, with impartiality, and in a manner that continues to foster a safe and efficient payment system,” Waters added.
Other firms like Custodia Bank, Anchorage Digital Bank, and Ripple through its Standard Custody & Trust Company have also sought similar Federal Reserve master accounts. Waters cited the rapid pace of financial innovation as heightening the need for clear legal grounding and risk management.
The crypto advocacy group Stand With Crypto lists Waters as “strongly against crypto.” This classification is based on her public statements and multiple votes against crypto-related legislation, including the Digital Asset Market Clarity Act. She has previously expressed regulatory concerns, including calling for a hearing with the SEC chair last year over dismissed crypto enforcement cases.
