Anchorage Digital Bank has formally objected to a Federal Reserve proposal that would create a limited-purpose payment account, arguing it fails to function as a viable alternative to a traditional master account. In a comment letter submitted this week, the OCC-chartered national trust bank outlined why the new structure falls short for institutions seeking direct access to US payment rails.
The Federal Reserve advanced the concept—sometimes called a “skinny master account”—after a May 2026 proposal that sought public feedback. Under the framework, payment account holders could access Fedwire, FedNow, and the National Settlement Service, but would not receive intraday credit, discount window access, or interest on balances. Crucially, the accounts also exclude FedACH, the automated clearing house network that processes the bulk of everyday electronic payments.
Anchorage, which applied for a full master account in August 2025, insists the missing FedACH access is a deal-breaker. “The exclusion of FedACH access materially limits the functionality of the Payment Account and would require Payment Account holders to continue to rely on intermediaries for day-to-day payment and settlement activities,” the bank wrote. It also pointed to overnight balance caps that force firms to move client funds to third-party banks at the close of business, reintroducing counterparty and operational risks. The lack of intraday liquidity and interest on reserve balances further disadvantages payment account holders compared with traditional master account institutions.
The bank also raised concerns about being placed under a review tier alongside entities that lack a federal primary supervisor. Anchorage argues that federal supervision—not deposit insurance status—should determine eligibility for central bank infrastructure.
Almost 100 other comment letters were filed by crypto groups, exchanges, bank associations, and lawmakers. Senator Cynthia Lummis (R-Wyo.) said she looked forward to the Fed “finalizing the rules and policies implementing the payment account as soon as possible.” The Blockchain Association agreed that the proposed restrictions make the accounts commercially impractical. Conversely, traditional banking associations endorsed the limitations and called for even tighter oversight of non-traditional applicants, warning that some institutions would be “subject to less rigorous supervision and regulation.”
The proposal is part of a broader effort by the Fed to modernize payment system access, but the intense pushback from a regulated crypto-native bank underscores the gap between the central bank’s offered compromise and the industry’s desire for full master account privileges.
