Fed May Open Direct Settlement Rails to Crypto Firms as Kraken's Banking Move Forces the Issue!

Kraken didn't wait for TradFi to come around — it built its own bank and secured a Federal Reserve master account, a move that could fundamentally redraw how crypto firms access the US payment system. The development puts direct Fed settlement rails within reach of the broader crypto industry for the first time.

The significance here is structural: banks have long warned that extending Fed access to crypto firms creates liquidity risk, and that argument has kept the industry at arm's length from the core of US monetary plumbing. Kraken's master account punches a hole in that wall — and regulators will now have to decide whether to formalize the pathway or close it.

For the crypto industry, direct Fed access means bypassing the correspondent banking layer that has been a persistent chokepoint for settlement speed, counterparty risk, and operational resilience.