Stu Alderoty, the chief legal officer of Ripple, recently told Reuters that a “skinny” master account would still be an attractive option for the company. 🐉💸 Because nothing says “I’m a good boy” like a Fed account with a side of restrictions.
The CLO has opined that it should give traditional banks “some comfort.” Or maybe just a mild sedative. 🧠💤
A skinny account, explained 🧐
A Federal Reserve master account is the core deposit and payment account that the Fed offers to depository institutions. The firms that have such accounts can send and receive wholesale payments over Fed payment rails of the likes of FedNow and settle in central-bank money. Because who doesn’t want to play with the Fed’s toy train? 🚂
Fed Governor Christopher Waller recently floated the idea of a “skinny” master account, which, as the name suggests, would serve a a lite version of a full master account. A skinny account would have such limitations as no access to emergency funds and no interest on balances. Perfect for those who prefer their financial security with a side of existential dread. 😱
The Fed is currently in the process of studying Wallet’s “skinny” account idea, meaning that there will be no immediate rollout. Because patience is a virtue… and also a delaying tactic. 🕒
Pushback from banks 🦖
As reported by U.Today, Ripple applied for a Fed master account earlier this year. This would allow it to quickly redeem the reserves that are backing the RLUSD stablecoin. Because nothing says “trust us” like a crypto company asking the Fed for a lifeline. 🤝
Anchorage Digital Bank, Paxos Trust Company are also among the crypto firms that have applied for Fed master accounts. And here I thought the Fed was a bank. 🏦
There is a rather strong pushback from the banking sector, which is worried about financial stability and growing competition that could cost them market share and fee income. Oh no, the future is here! 🚀 However, Walker’s proposed prototype could be an acceptable compromise. Or a very expensive placebo. 💊
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2025-11-06 23:34