Federal Reserve Says Custodia’s Plans Would Endanger Itself and the Crypto Industry

In contrast to what federal regulators had once agreed was the safest course for stablecoins – that they be issued by regulated banks or financial firms that are under similar strict rules – the Fed had a lot to say Friday about how dangerous a Custodia-issued stablecoin could be. More in line with statements the U.S. banking regulators had issued at the start of the year, the central bank outlined worries about what would happen with Custodia’s token Avit if the business were granted a Fed master account.