Ripple Denied Master Account Access by Caitlin Long's Declaration
The Federal Reserve's Account Access Guidelines, finalised in August 2022, have introduced a three-tier review system for access to master accounts and services. This system is significant for companies looking to participate in the payment system, particularly those involved in cryptocurrency.
One such company is Ripple, which has made headlines recently with its moves towards a national bank charter and a master-account application. This shift comes as a response to the inability of the trust-company architecture around Ripple USD to unlock direct access to Fedwire and ACH.
Ripple's acquisition of Standard Custody & Trust Company in June 2024 and its entry into the crypto-adjacent access requests, alongside WisdomTree Digital Trust, underscore the sector's shift towards bank-grade plumbing. However, Ripple's application for a German banking license, as of the current date, remains unconfirmed.
The Federal Reserve's Master Account and Services Database, updated as of May 31, 2025, lists the status of access requests, including those from Kraken Financial, Protego Trust, Bankwyse, Commercium Financial, Paxos, Custodia (whose request was denied), Standard Custody & Trust (Ripple-owned), and WisdomTree Digital Trust. Custodia's request was denied, highlighting the stringent criteria for access.
If Ripple's national bank charter and master-account application clear eligibility, they must still pass the Fed's risk-based scrutiny. Caitlin Long, CEO of Wyoming-chartered Custodia Bank, has had extensive conversations with the decision makers at the Federal Reserve and believes the policy won't bend for trust companies regarding deposit-taking banks.
Long emphasises that trust companies, including OCC trust companies, are not eligible to get access to the payment system for moving US dollar deposits. This is due to the legal prohibition for a trust company from accepting a US dollar deposit. Stablecoin issuers, according to Long, are not legally depository institutions.
Long also argues that only financial institutions that are legally authorised to accept a US dollar deposit can access the Federal Reserve's payment system. Courts have upheld the Fed's discretion to deny master-account requests, even for legally eligible institutions.
In Long's telling, stablecoin issuance will ultimately consolidate inside banks, some of which may be crypto-founded but will nevertheless be banks. The value of moving money in the payment system, she suggests, relies on the par guarantee, which won't be available to trust companies unless they become banks.
At press time, XRP traded at $2.98. The future of Ripple's master-account application and national bank charter remains to be seen, but it is clear that the company is making strategic moves to navigate the complex world of banking and cryptocurrency.
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