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Despite fierce resistance from conventional banks, the Fed is moving forward with plans to grant direct access to its payment systems to cryptocurrency exchanges and financial technology companies.
In late 2025, the Fed suggested customized “payment accounts” at the request of Fed Governor Christopher Waller. By allowing qualified non-bank companies to process payments directly through government platforms like FedNow and Fedwire, these streamlined accounts would do away with the need for full banking licenses.
Banks push back against proposed rules
Under the proposal, companies would face several limits designed to protect the financial system. Account holders could not earn interest, have no access to emergency lending facilities, and must keep overnight balances below either $500 million or 10 percent of their total assets, whichever is smaller.
The Fed asked for public input on the plan in December 2025, sparking a heated debate between banking groups and technology companies.
In February 2026, major banks retaliated by requiring a 12-month waiting time before they would accept any new applicants. In a joint letter, the Financial Services Forum, the Bank Policy Institute, and the Clearing House Association called for a risk to the financial system.
They are concerned that granting payment access to less-regulated businesses may expose the whole financial system to new vulnerabilities, particularly for cryptocurrency companies that issue dollar-backed digital tokens.
Governor Waller has pointed out the stark divide between internet businesses favoring less regulation and banks calling for stricter guidelines. He describes the new framework as a compromise approach and intends to complete it by the end of 2026 in spite of the opposition.
Coinbase leads support for direct access
Coinbase, the largest U.S. cryptocurrency exchange, has become a vocal supporter of the plan, arguing that direct Fed access is essential for updating America’s payment infrastructure.
The exchange said direct Fed access would let crypto and fintech firms tap into the backbone of the global financial system without needing full bank licenses. Right now, most digital asset companies must work through partner banks, adding costs, delays, and extra risks to their operations.
“By reducing reliance upon FDIC-insured partner banks as intermediaries for core payment functions, the Payment Account would allow account-holding institutions to offer safe and efficient services to U.S. consumers and businesses and, at the same time, reduce costs and ensure the ability of emerging payment providers to scale with growing demand,” Coinbase wrote.
Faryar Shirzad, senior policy officer at Coinbase, mentioned similar efforts now in progress in the UK, Brazil, India, and the EU. By boosting competition, reducing settlement risks, and enhancing payment efficiency, these technologies have assisted those countries in maintaining their competitiveness in the global financial system.
But the Fed’s current plan was also challenged by Coinbase as being overly restricted. The exchange warned that the requirements may render the accounts unusable for large-scale activities, so rendering the framework possibly “dead on arrival.”
The exchange specifically criticized low overnight balance limitations and the prohibition on generating interest. According to Coinbase, processing payments mostly entails operational risks, not credit or market risks, which need capital buffers based on firm size.
Coinbase also asked regulators to allow “omnibus” customer accounts, which would let firms combine user funds for more efficient settlement processes.
Coinbase’s advocacy drew the attention of financial markets. Following the release of its letter and impressive quarterly financial results, the company’s shares surged by 15%. For cryptocurrency platforms, investors see the possibility of large cost reductions and improved growth prospects.
Despite concerns about money laundering and other illicit activities, industry analysts predict that direct Fed access may reduce transaction costs for digital asset services by 20 to 30 percent.
The Fed’s comment period closed on February 6, 2026. The final verdict will shape US payment systems as regulators balance financial stability and innovation.
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