The Federal Reserve on Thursday proposed a limited “skinny” payment account framework that would give fintech and crypto firms a narrow path into the central bank’s payment system — but immediately called for a temporary halt on processing Tier 3 applications. The move comes in response to a Trump administration order, marking the latest step in the White House’s push to integrate digital asset firms into the traditional banking system.
A narrow doorway to the Fed
Under the proposal, non-bank payment companies would qualify for a restricted type of master account, offering only basic payment services without the full suite available to traditional banks. Fed officials described the accounts as “limited-purpose,” designed to oversee the flow of funds without giving firms direct access to the discount window or other lender-of-last-resort facilities. The framework is a scaled-back version of earlier efforts to expand Fed access — a compromise between full membership and no access at all.
Tier 3 applications on ice
Alongside the proposal, the Fed directed its regional banks to pause processing any new applications for Tier 3 accounts — the riskiest category of non-bank access. The moratorium applies to all pending and future submissions and will remain in place until the board completes a review of the new skinny account guidelines. For any crypto or fintech firm that had been pursuing Tier 3 access, the pause is a setback. Several digital asset companies had been betting on the Trump administration’s friendlier stance to get direct Fed entry. Now they’ll have to wait.
The Trump order catalyst
The proposal isn’t emerging in a vacuum. It follows an executive order from President Trump earlier this year directing federal agencies to find ways to expand banking services for digital asset companies. That order put pressure on the Fed to craft rules that would let crypto firms into its payment network without exposing the system to undue risk. The skinny framework is the Fed’s answer — a limited option that gives the administration something to point to, while keeping the central bank’s cautious approach intact.
The Fed is now accepting public comment on the skinny account framework for 60 days. After that, it will finalize the rules and decide when to lift the Tier 3 pause. For now, crypto firms eager for Fed access have a new path — but it’s a narrow one, and it comes with a waiting period.
