U.S. Federal Reserve rejects Custodia Bank’s request for reconsideration of Fed supervision

(Reuters) – The U.S. Federal Reserve on Thursday denied crypto-focused Custodia Bank’s request that the central bank reconsider its application to become a member of the Federal Reserve System.

The Fed previously said Custodia, which is based in Wyoming and is chartered through the state as a special purpose depository institution, lacked a sufficient risk management framework to address the heightened risks associated with crypto.

(Reporting by Hannah Lang in Washington; Editing by Chris Reese)