Lawyer: Custodia/Fed lawsuit as important as SEC/Ripple case

Odaily Planet Daily News The encrypted bank Custodia previously applied to become a member of the main account of the Federal Reserve Bank, but was rejected by the Kansas City Fed earlier this year. Custodia has filed three lawsuits against the Fed in three different circuit courts. In this regard, lawyer John Deaton said that Custodia's litigation battle with the Federal Reserve is as important (if not more important) as the SEC/Ripple (XRP) case. Founded in 2020 by Morgan Stanley veteran Caitlin Long, Custodia provides a bridge between digital assets and the U.S. dollar system. Custodia’s lawsuit alleges the Fed unlawfully delayed its application for a master account, an essential component necessary to effectively participate in the U.S. financial ecosystem. Custodia scored a key victory after filing a lawsuit in court, with a federal judge in Wyoming opposing the Fed's request to dismiss its lawsuit. Deaton said it was a clear example of major regulators ignoring their statutory obligations, a partial victory for companies in the crypto industry. These court cases have the potential to end the Fed's "arbitrary and erratic behaviour." (Cryptopotato) According to previous reports, Custodia Bank CEO Caitlin Long said that among the 35 banks that entered the FedNow payment system, Adyen from the Netherlands "entered the system through the back door", calling it "very un-American" for a European company. , because American companies do not have access to such opportunities. Just after last week's deadline for the SEC to reconsider Custodia Bank's application to become a member institution, the Fed rejected the application, saying in a brief statement that Custodia's business plan was "inconsistent" with factors required by law. Although her bank fights for master account rights, Caitlin doesn't think the new FedNow service is good enough. "It doesn't have interoperability, cross-border capabilities, and has a strict $500,000 transaction payment limit", Caitlin Long claimed that FedNow will occupy 10% of the payment share, "but not more than this number." She said the Fed claimed they would help companies regulate, and that Custodia "did its best to comply," but that authorities had become "unshakable."