A US court denied the Federal Reserve’s request to dismiss the Custodia Bank case.
Digital asset bank Custodia filed a lawsuit against the Federal Reserve in June 2022, alleging that an application for its main account was processed with an “illegal delay.” However, the court forwarded the request to the Fed to dismiss the case.
Custoida Bank Statement from the U.S. Court
A federal judge in Wyoming denied impeachment requests from both the Federal Reserve and the Federal Reserve Bank of Kansas City, allowing Custodia Bank to take a step forward in its legal battle against the Federal Reserve.
Custodia Bank has filed a lawsuit against the Federal Reserve, alleging that an application filed in June 2022 for its main account was processed with “unlawful delay.” In 2020, Caitlin Long, a former Morgan Stanley employee and one of the first proponents of Bitcoin, founded Custodia Bank to provide account services to crypto companies and act as a bridge to the US dollar.
Nathan Miller, spokesman for Custodia Bank, stated that the Fed’s request to dismiss the case was once again denied. Miller expressed satisfaction that the Federal Reserve’s attempt to give him veto power over state bank leasing decisions will be put to the test in federal court.
Custodia Bank filed an application for the Federal Reserve main account in October 2020. If the application was accepted, it would allow the bank to use a network known as the Federal Reserve’s FedWire network, which processed more than 196 million transactions last year. However, in January 2023, the Federal Reserve rejected the application, citing “not complying with the required factors under the law” and the bank’s involvement in the cryptocurrency space.
