- Anchorage Digital applies for Fed Master Account to access payment rails.
- Stricter guidelines challenge Anchorage’s bid for Federal Reserve access.
- Anchorage strengthens compliance, aiming to bridge crypto and traditional finance.
Anchorage Digital, the first federally chartered digital asset bank in the U.S., has applied for a Master Account with the Federal Reserve. This application, filed on August 28, marks a significant step for Anchorage, as approval would give the bank direct access to the Fed’s core payment systems, including wire transfers, ACH, and check clearing.
An Anchorage Master Account would help it avoid using traditional intermediaries, streamlining its operations to those of a conventional financial organization. This move is perceived to be necessary in digital asset banks aimed at creating parity with traditional banking systems.
Also Read: XRP Ledger Prepares for Multi-Purpose Tokens Activation Amid Strong Ecosystem Growth
Anchorage Strengthens Compliance as It Seeks Federal Reserve Access
Anchorage has already made strides in regulatory compliance. In 2021, the bank was placed under federal supervision when the Office of the Comptroller of the Currency (OCC) gave it a national trust charter. Nevertheless, this charter did not allow direct access to Fed settlement services, which are still inaccessible to the majority of crypto-related companies.
In 2022, Anchorage suffered a blow after receiving a consent order by the OCC in response to raised concerns regarding its anti-money laundering practices. However, the order was lifted in August of this year after improvements were made, marking the enhancement of Anchorage’s compliance framework. Nathan McCauley, the co-founder and CEO, prioritized the fact that the removal of the order illustrates that the federal authorities can regulate crypto firms without compromising regulatory standards.
The Push for Crypto Firms to Integrate into Traditional Banking Systems
As the U.S. Treasury Department advances the GENIUS Act, which focuses on stablecoin regulation, Anchorage’s application for a Master Account comes at a pivotal time for digital asset firms. A number of other companies, including Ripple, Circle, and Paxos, have also been looking to be licensed as a federal bank or similar to work towards becoming more deeply integrated into the traditional financial system.
The Federal Reserve has also adopted tighter measures when issuing Master Accounts, especially to crypto-related companies, which are normally classified as Tier 3. In spite of these difficulties, Anchorage’s bid is indicative of the wider shift by crypto asset companies towards filling the gap between crypto and traditional finance.
Also Read: XRP Takes DeFi by Storm: Enosys Launches Collateralized Loans on Flare Network!
