President Donald Trump has instructed the Federal Reserve (Fed) to explore expanding fintech companies’ access to payment systems. This move could potentially lower the barriers for cryptocurrency exchanges and fintech firms to tap into the Fed’s payment infrastructure.
Reuters reports that on Tuesday, Trump signed an executive order directing the Fed and financial regulators to review regulations that might be impeding financial innovation.
The order specifically calls on the Fed to reassess its policies regarding payment account access for fintech and non-bank financial companies, and to consider ways to broaden this access.
Reuters interprets this action as reflecting the Trump administration’s pro-fintech and pro-cryptocurrency policy stance.
The Fed operates master accounts, which allow banks to directly connect to the central bank’s payment system for fund transfers. Traditionally, access to these accounts has been limited to conventional banks, but cryptocurrency exchanges and fintech companies have recently been pushing for expanded access.
In March, the cryptocurrency exchange Kraken was granted a master account, giving it access to Fedwire, the central bank’s wholesale payment system.
Reuters also reports that other cryptocurrency firms like Ripple and Anchorage Digital, as well as the remittance fintech company Wise, are actively pursuing access to master accounts.
Last December, the Fed sought public input on potentially introducing a limited payment account model similar to the one granted to Kraken.
However, some experts caution that broadening non-bank financial companies’ access to the central bank’s payment network could intensify concerns about financial stability and anti-money laundering regulations.