Top Democrat on House committee questions Kraken's Federal Reserve account

Policy Share Share this article Copy link X icon X (Twitter) LinkedIn Facebook Email Top Democrat on House committee questions Kraken's Federal Reserve account Maxine Waters, who would likely take the House Financial Services Committee gavel again if Democrats win the House, sent a letter to the Kansas City Fed. By Jesse Hamilton | Edited by Nikhilesh De Mar 26, 2026, 10:17 p.m. Make preferred on The Federal Reserve account obtained by Co-CEO Arjun Sethi's Kraken is being questioned by a lawmaker. (Jesse Hamilton/CoinDesk) What to know : Kraken's recent victory in getting a limited version of a Federal Reserve master account is under some scrutiny from a senior lawmaker in the U.S. House of Representatives. Representatives Maxine Waters, the senior Democrat in the House Financial Services Committee, sent a letter to the president of the regional Fed bank that approved the first-ever account for a crypto firm. Her questions may carry additional weight as the calendar progresses toward this year's congressional elections in November, when the majority could swing to her Democratic Party. U.S. Representative Maxine Waters, the ranking Democrat on the House Financial Services Committee, is questioning the limited "master account" obtained by crypto exchange Kraken from the Federal Reserve Bank of Kansas City, which she said raises potential consumer-protection issues and questions about the approval process. Waters, who is likely to return to the chairman seat on the committee if the Democrats regain a House majority in this year's elections (set at an 84% chance in current bets on Polymarket), sent a Thursday letter to the president of the Kansas City arm of the Fed system, Jeff Schmid. She suggested that the unusual approval for a "limited purpose account" at Kraken, which allows the firm to become the first to win direct access to Federal Reserve payment services, is on unclear legal footing. "The announcement raises questions about the approval because neither statute nor the Federal Reserve Board’s Account Access Guidelines refer to a 'limited purpose account' type," she wrote in the letter. "Accordingly, I write to request that you clarify the terms of Kraken’s account access approval and provide additional information regarding the process and considerations informing the approval." The new account granted the U.S. firm full-fledged access to the same payment rails that much of the traditional financial system operates on. Several crypto-native firms have sought that access but are still awaiting approval, keeping a close eye on a separate effort at the Federal Reserve Board in Washington to write rules that could govern a "skinny" master account for such businesses. That process is still in the early stages. When the Kansas City Fed was asked to comment on Waters' queries, a spokesman said the bank has "received the letter and will review it." The regional bank in Kansas City — one of the 12 such banks nationwide — announced earlier this month that Kraken would get the long-sought-after access. Schmid said at the time that his bank was trying to maintain a system that "supports a level competitive field and reinforces the stability and resilience that has underpinned the Federal Reserve’s payment system offerings throughout its history.” Read More: Court closes Custodia fight with Federal Reserve just as Fed opens master-account door More For You The Definitive Stablecoin Landscape Series: North America By CoinDesk Research 7 hours ago Commissioned by Ripple As stablecoins evolve into core financial infrastructure, North America leads. This report maps the regulation, market shifts, and players driving adoption. Why it matters : Stablecoins are entering their third phase of evolution - the institutionalization era - becoming increasingly embedded into core financial infrastructure. As institutions prioritize transparency and compliance, regulated issuers like USDC, RLUSD, and PYUSD are steadily gaining share with RLUSD surpassing $1B in market cap within its first year. North America, leading in regulatory frameworks and institutional distribution, is at the center of it all. View Full Report More For You Stablecoin rewards restrictions can slow but not stop Circle's USDC, says Citigroup By Will Canny , AI Boost | Edited by Stephen Alpher 8 hours ago USDC adoption hinges on volume, not circulation, the bank said What to know : Citi said limits on stablecoin rewards could reduce USDC circulation short term, but won’t hit Circle’s core revenue. The bank maintained that stablecoin usage (volume), not supply, is the primary adoption signal. The Circle selloff reflected a market misread of the draft Clarity Act, according to broker Bernstein. Read full story Latest Crypto News Crypto edges off of worst levels after Trump extends Iran strike pause 1 hour ago GameStop turned its $368 million bitcoin stash into an options income play 1 hour ago OKX won’t rush IPO as exec warns poor listings hurt crypto industry 2 hours ago Strategy’s 11.5% dividend equity bounces back faster than historical average to unlock more bitcoin buying 3 hours ago Why big banks are snubbing open ledgers to build their own private blockchains 5 hours ago Bitcoin slips below $69,000 as oil rebounds on fading Middle East peace hopes 5 hours ago Top Stories Coinbase, Fannie Mae bring crypto-backed mortgages to homebuyers 10 hours ago Market structure bill compromise draws wide-ranging reaction from fractured crypto crowd 23 hours ago Bitcoin has traded in a tight range for nearly 50 days – but this is not a "bear flag" 12 hours ago MARA Holdings higher by 10% after selling $1.1 billion in bitcoin to fund debt buyback 9 hours ago U.S. midterms pack major digital assets punch as Stand With Crypto preps strategy 10 hours ago Some bitcoin indicators are still going the wrong way, challenging the bullish $70,000 holdout story 16 hours ago