Caitlin Lengthy, the CEO of Wyoming-chartered Custodia Financial institution, delivered a stark evaluation of crypto’s path to the Federal Reserve’s rails, arguing that companies working below belief charters—together with Ripple—is not going to be granted direct entry to the Fed’s fee system until they turn out to be true depository establishments.
“Stablecoin issuers will not be legally depository establishments,” she mentioned. “To have the ability to use Fedwire and ACH, the Fed has taken the place that it’s important to be a depository establishment… A belief firm by legislation is prohibited from accepting a US greenback deposit.” She added that whereas some belief corporations have traditionally had restricted master-account preparations, it was “not for transferring cash within the fee system,” and the important thing prize—“the par assure”—belongs to banks alone. “You’ve bought to legally be a depository establishment,” Lengthy mentioned, concluding, “I firmly do imagine… the Fed shouldn’t be going to vary that.”
Lengthy’s view arrives as Ripple pushes deeper into bank-grade infrastructure. Ripple closed its acquisition of Customary Custody & Belief Firm in June 2024, positioning the New York-chartered belief firm on the heart of its stablecoin stack, and has continued to develop its regulated footprint since then.
In early July 2025, Ripple utilized for a US nationwide financial institution constitution and is pursuing a Federal Reserve grasp account—strikes that might, if authorized, put Ripple USD (RLUSD) reserves and settlement nearer to the Fed’s stability sheet and its fee providers. Lengthy’s message to that technique is unambiguous: belief standing is an “middleman cease.” “There have been a number of now who’ve utilized for Fed grasp accounts,” she mentioned, however entry to Fedwire/ACH “is the excellence,” and “the stablecoin market, I firmly imagine, will go fully to the banks.
Can Ripple Get A Fed Masters Account?
The Fed’s authorized and coverage framework backs up the excellence Lengthy describes. In August 2022, the Board finalized its Account Entry Pointers, which formalized a three-tier assessment system and made clear that Reserve Banks consider requests for entry to “grasp accounts and providers” in opposition to safety-and-soundness, authorized eligibility, and systemic-risk standards. The framework topics non-insured, novel charters to essentially the most stringent assessment.
Individually, the Federal Reserve defines a grasp account as “the file of monetary rights and obligations” between an account holder and its Administrative Reserve Financial institution—exactly the ledger relationship that allows par settlement on Fed rails.
Courts have since affirmed broad Fed discretion to disclaim master-account requests even for legally eligible establishments, a precedent set in 2024 rulings that rejected arguments the Fed should grant entry upon request. That judicial backdrop is central to Lengthy’s declare that coverage gained’t bend for belief corporations: “I’ve had very in depth conversations with the precise determination makers,” she mentioned, and the road drawn round deposit-taking banks “shouldn’t be going to vary.”
Naming names clarifies the place crypto stands as we speak. The Federal Reserve’s public Grasp Account and Providers Database—up to date most lately with knowledge present as of Could 31, 2025—lists new “entry requests” and their standing, providing an official window into who’s asking to hitch the fee system straight. A Congressional Analysis Service report, citing that database, notes that Kraken Monetary and Protego Belief have pending purposes, whereas Bankwyse, Commercium Monetary (a Wyoming SPDI) and Paxos withdrew theirs; Custodia’s request was denied.
After that, Customary Custody & Belief (Ripple-owned) and WisdomTree Digital Belief have entered the crypto-adjacent entry requests, underscoring the sector’s shift towards bank-grade plumbing at the same time as eligibility questions stay for belief corporations.
Lengthy, for her half, emphasised the authorized dividing line these lists reveal: “All these belief corporations, together with OCC belief corporations, [are] not eligible to get entry to the fee system for transferring US greenback deposits… Gaining access to Fedwire and ACH on the Fed, you’ve bought to legally be a depository establishment.”
Her argument activates first rules slightly than coverage temper. “What’s a depository establishment? It’s a monetary establishment that’s legally licensed to simply accept a US greenback deposit,” Lengthy defined. As a result of belief corporations are “prohibited from accepting a US greenback deposit,” the Fed’s fee system stays a bank-only lane. The consequence, she mentioned, is structural: “These belief corporations… are middleman stops. That’s nice… [they] give corporations the flexibility to do enterprise nationwide” with out fifty separate money-transmitter licenses. “However… not for transferring cash within the fee system.”
In Lengthy’s telling, stablecoin-issuance will in the end consolidate “fully” inside banks—a few of which can be crypto-founded however will nonetheless be banks—as a result of solely banks can faucet the Fed’s par-clearing privilege at scale. For Ripple, the trail ahead subsequently appears to be like binary. The trust-company structure round Ripple USD can help custody and fiduciary capabilities; it can not, in Lengthy’s studying and the Fed’s rule set, unlock direct Fedwire/ACH entry by itself.
That explains Ripple’s pivot towards a nationwide financial institution constitution and a master-account utility—steps that, even when they clear eligibility, should nonetheless cross the Fed’s risk-based scrutiny that tripped different candidates. Within the meantime, Lengthy’s backside line hangs over each trust-charter technique in crypto: “The worth of transferring cash within the fee system? It’s the par assure.” And that, she insists, “gained’t” be accessible to belief corporations—Ripple included—until they turn out to be banks.
At press time, XRP traded at $2.98.
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