- Crypto bridge Custodia Bank scored a huge triumph in its ongoing case against the Federal Reserve.
- The Wyoming judge denied the FED's attempt to dismiss Custodia's suit allowing the bank to proceed with plausible claims.
- Custodia is a new type of bank that aims to bridge the gap between crypto and the US dollar system.
In a recent ruling, crypto Bank Custodia celebrated a significant triumph in its ongoing battle against the Federal Reserve, marking a pivotal moment in the institution's legal fight.
On Thursday, a Wyoming Federal Judge issued a decision denying the Federal Reserve's attempt to dismiss Custodia Bank's lawsuit. This ruling has reignited Custodia's optimism as it continues its legal challenge against the powerful financial institution.
Founded in 2020 by Caitlin Long, a former Morgan Stanley veteran, Custodia Bank was established with the aim of bridging the gap between digital assets and the US dollar system.
The lawsuit, filed by Custodia in June 2022, alleges that the Federal Reserve unlawfully delayed the bank's application for a crucial component known as a "master account." This master account is essential for Custodia to operate effectively within the U.S. financial system.
In January of this year, Custodia amended its complaint, seeking to determine whether the Federal Reserve possesses the authority to obstruct the bank from obtaining a master account.
Custodia holds the distinction of being one of Wyoming's pioneer Special Purpose Depository Institutions (SPDIs), often referred to as "blockchain banks." These SPDIs were established to cater to businesses involved in cryptocurrency transactions that face challenges in securing services from the Federal Deposit Insurance Corporation. Notably, in April, the state of Wyoming expressed its intent to intervene in the case between Custodia Bank and the Federal Reserve, actively defending its framework that allows certain crypto firms to qualify as state-chartered banks.
With the recent ruling denying the Federal Reserve's bid to dismiss the lawsuit, Custodia Bank is now fortified in its pursuit of justice, eagerly awaiting the next phase of this critical legal showdown.
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