Wyoming-based crypto bank Custodia Bank has officially filed a petition for a writ of certiorari with the U.S. Supreme Court, asking it to review whether regional Federal Reserve Banks have the discretion to deny eligible state-chartered banks access to master accounts, as per journalist Eleanor Terrett’s X post on July 10, 2026.
The case, Custodia Bank, Inc. v. Federal Reserve Board of Governors, et al., is listed on the Supreme Court docket under Case No. 25A1320, arising from the Tenth Circuit’s decision in Case No. 24-8024. Justice Neil Gorsuch had granted Custodia a 30-day extension on May 29, 2026, giving the bank until July 11, 2026, to file its petition. With the filing now submitted, the bank has met that deadline with a day to spare.
Davis Polk Leads Custodia’s Push Before the Supreme Court
Custodia has hired a team of legal experts for the fight, including white-shoe law firm Davis Polk and Wardwell LLP, with Kannon K. Shanmugam serving as counsel of record. The petition argues that the Federal Reserve Bank of Kansas City’s decision to deny Custodia a master account “works a fundamental shift in the balance between state and federal authority over banking.”
It further contends that the denial raises significant constitutional questions about the appointment and powers of Federal Reserve Bank presidents and threatens the future viability of dozens of banks with innovative business models.
The filing comes after both a Wyoming district court and a divided Tenth Circuit panel sided with the Fed’s interpretation of the Monetary Control Act, finding that the Federal Reserve has broad discretion to deny Custodia access to a master account. As cited in the petition, the Kansas City Fed said its 2023 decision was driven by concerns over Custodia’s crypto-centric business model.
Custodia’s Five-Year Fight for a Fed Master Account
Founded by Caitlin Long, Custodia operates under Wyoming’s special-purpose depository institution (SPDI) charter and first applied for a Fed master account in October 2020. The Federal Reserve Bank of Kansas City formally rejected the application in January 2023, citing safety and soundness concerns tied to the bank’s digital asset focus.
The Tenth Circuit Court of Appeals affirmed the district court’s ruling in a 2-1 panel decision on October 31, 2025. Then, on March 13, 2026, the full court denied Custodia’s petition for en banc rehearing by a vote of 7-3. In dissent, Judge Timothy Tymkovich warned that endorsing unreviewable discretion effectively hands the Reserve Banks a veto over states’ chartering power.
What a Supreme Court Ruling Could Mean for Crypto Banking
The battle between Custodia and the Fed is not just about crypto. A master account is a bank’s direct gateway to the Fed’s payment rails, including Fedwire and ACH, and the case strikes at the heart of the dual banking system that allows banks to charter under either federal or state law.
A Supreme Court ruling in Custodia’s favor could fundamentally limit the Fed’s power to block state-chartered institutions from payment system access, reshaping how crypto banks operate nationwide.
With the petition now officially filed, all eyes will turn to whether the Supreme Court agrees to take up the case. If it does, the years-long legal fight between Custodia and the Fed will enter its final and most consequential phase.
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