Fed details Custodia rejection decision
Decision says Wyoming firm has deficient management and risky business model
The US Federal Reserve Board denied a crypto bank’s application for membership because regulators concluded the bank lacked a suitable business model or sufficient internal controls.
Regulators first turned down Custodia Bank’s application in a ruling dated January 27, which it published on March 24. The Fed rejected a second membership request in February.
Custodia is a virtual asset services provider headquartered in Wyoming, a state that has positioned itself as crypto friendly.
The
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