The Federal Reserve Board has ignited a debate with its proposal for a new type of limited-purpose payment account, facing significant pushback from both traditional banks and the cryptocurrency industry. The proposal, introduced on December 19, 2025, outlines a prototype called a "skinny master account" designed to provide eligible financial institutions, particularly fintechs, with restricted access to the Federal Reserve's payment systems.
The core of the proposal involves creating accounts that impose strict limitations, including caps on balances and the exclusion of services like overdrafts and interest payments. The stated goal, as supported by Federal Reserve Governor Christopher Waller, is to foster innovation in the payments sector—including potential advancements in stablecoin-related payments—without exposing the financial system to the full risks associated with traditional master accounts. Governor Waller has indicated the Fed aims to make these accounts available by the fourth quarter of 2026.
However, the plan has met with notable dissent. Federal Reserve Governor Michael Barr has expressed concerns over what he views as insufficient anti-money laundering safeguards within the proposal. More broadly, the banking industry, represented by groups like the Bank Policy Institute and the American Bankers Association (ABA), has voiced strong opposition. Banks argue that granting payments companies easier access to Fed services could undermine financial stability and alter the competitive landscape.
While the proposal does not name specific cryptocurrencies like Bitcoin (BTC) or Ethereum (ETH), analysts note it could indirectly benefit the stablecoin sector by facilitating more streamlined and secure crypto-related payment innovations. The public comment period for the proposal is set to conclude on February 6, 2026, after which the Federal Reserve will decide on its final implementation.
