Fed seeks public input on ‘skinny master account’ for limited access to the central bank

The U.S. Federal Reserve has initiated a request for information to gather public feedback on a proposed "payment account," informally called a "skinny master account." This new account would grant certain eligible institutions, possibly including some crypto-related firms, limited access to the Fed's payment services for clearing and settling payments, without the full privileges of a traditional master account. Republican Fed Governor Christopher J. Waller supports the move, stating it would foster innovation while maintaining payment system safety. The proposed account would have limitations, such as not earning interest on balances, and the Fed is exploring additional risk controls like specific reporting requirements. However, Democratic Fed Governor Michael Barr expressed reservations, stating he cannot support the request for information because it lacks sufficient specificity regarding safeguards against money laundering and terrorist financing by institutions the Fed does not directly supervise. Comments on the proposal are due in 45 days.

(Source：The Block)