American Fintech Council Backs Fed Payment Account Opening Access for Crypto Firms
- American Fintech Council backs Fed Payment Account access for crypto firms under strict limits.
- Banks warn the proposal could raise systemic risk despite balance caps and usage restrictions.
- Fed Payment Account debate intensifies as White House hosts banks and crypto groups.
The American Fintech Council (AFC) has stepped into one of Washington’s most active policy debates by backing a Federal Reserve proposal that could reshape how crypto firms connect to the U.S. payment system. In a formal letter sent to the central bank on February 9, the trade group endorsed a limited-access framework designed to give eligible fintech and digital asset firms a direct route into federal payment rails without granting them full banking privileges.
However, the proposal quickly became a flashpoint between advocates of financial innovation and traditional banking institutions. Supporters say the plan modernizes settlement infrastructure and reduces reliance on a small number of intermediary banks. Critics, on the other hand, argue that it risks expanding access to the Federal Reserve’s balance sheet for firms that lack long-standing supervisory oversight.
At the center of the debate is the Fed Payment Account, a narrowly defined account structure that would allow non-bank firms to clear and settle transactions directly with the Federal Reserve. According to the American Fintech Council, the model preserves core safety features of the banking system while addressing competitive barriers faced by fintech and crypto companies.
AFC Pushes Limited Access Model
In its submission to the Federal Reserve Board, the American Fintech Council said a well-designed Fed Payment Account could expand competition in payments without undermining prudential safeguards. Chief Executive Officer Phil Goldfeder stated that the approach balances innovation with risk management by strictly limiting what participating firms can do.
A well-designed Payment Account can expand competition and responsible innovation in payments without introducing new risk or undermining the Federal Reserve’s longstanding prudential safeguards,” Phil Goldfeder, CEO of the American Fintech Council, noted.
Unlike a traditional master account, the Fed Payment Account would not provide access to the discount window, would not pay interest on balances, and could not be used as a general-purpose deposit account.
Its function would be confined to clearing and settlement activity across systems such as Fedwire and FedNow. Per reports, the Federal Reserve first sought public feedback on the concept in December 2025 after Governor Christopher Waller raised the idea earlier that year.
Banks and Crypto Firms Split Over Risks
Meanwhile, the Fed’s comment process revealed a sharp divide. Digital asset firms and fintech groups largely welcomed the proposal, while banking associations urged caution. One such stablecoin issuer, Circle, said the account structure could increase the resiliency of the payment system by reducing concentration risk.
The Blockchain Payments Consortium, which includes Fireblocks, Polygon, Solana, and TON, further argued that the model could limit uncompetitive practices tied to reliance on a few large banks. Yet, not all crypto firms offered unqualified support.
Anchorage Digital described the Fed Payment Account as a positive step but criticized restrictions that still leave firms without direct access to the Automated Clearing House and prohibit earning interest on reserves. Banking groups, on the other hand, raised broader concerns.
The American Bankers Association warned that many potential applicants lack a long supervisory history. In a joint letter, the Bank Policy Institute, the Clearing House Association, and the Financial Services Forum said the proposal marks a significant policy shift by allowing uninsured or lightly supervised institutions to connect directly to the Federal Reserve.
Related: White House Pushes Banks and Crypto Toward Stablecoin Deal
Policy Debate Extends to White House
The issue has also reached the White House. According to Crypto In America, administration officials scheduled a meeting to ease tensions between banks and crypto firms. The gathering is expected to include senior policy staff, representatives from banking and crypto trade groups, and legal executives such as Coinbase Chief Legal Officer Paul Grewal.
Sources said banks, including Bank of America, JPMorgan, and Wells Fargo, were also invited. While stablecoin yield is expected to dominate discussions, the Fed Payment Account remains a key fault line. Bank groups argue that even with balance caps, such accounts could heighten run risk by supporting deposit-like activity outside the federal safety net.
Crypto advocates counter that direct settlement access could reduce systemic risk by lowering dependence on a small set of correspondent banks. For now, the Federal Reserve has made no final decision. The outcome of the proposal will help determine how crypto firms integrate into U.S. payment infrastructure and whether limited central bank access becomes a permanent feature of the financial landscape.
