The Crypto-friendly Custodia bank, founded by Caitlin Long, a well-known figure in the crypto industry, has been denied its application to come under the supervision of the U.S. Federal Reserve (Fed), according to an official announcement.
The Board had previously announced the denial of the application. Still, the announcement confirmed that the order outlining the decision was not immediately available due to the need to review it for confidential information.
Fed’s Decision Based On Custodia’s Ties With Crypto?
The order of the Federal Reserve Board notes “concerns” about Custodia Bank’s proposed business plans, which focus entirely on the crypto sector. The Board believes that banks with business plans focused on a narrow sector of the economy may pose heightened risks, as they may be more “susceptible” to economic or regulatory challenges.
Furthermore, the recently released denial by the Fed notes that the…
