Fed seeks ‘skinny’ account comment

Core Insights - The Federal Reserve is considering the creation of a limited-use payments account aimed at eligible banks and credit unions, which would not provide all the benefits of current master accounts [3][7] - This initiative reflects a shift in the Federal Reserve's perspective towards fintech and decentralized finance, indicating a willingness to embrace innovation rather than resist it [5][6] Group 1: Federal Reserve's Proposal - Federal Reserve Governor Christopher Waller introduced the concept of a "skinny" account that would limit the central bank's risk while catering to emerging financial technologies [3][5] - The account is intended for clearing and settling payment activities of eligible institutions, focusing on payments innovation [7] Group 2: Industry Reactions and Context - Fintech companies have been advocating for direct access to central bank accounts, but Waller clarified that the new account would primarily be available to financial institutions [4] - The Federal Reserve Board voted 6-1 to seek public comment on the proposed account, with one dissenting vote expressing concerns about potential misuse for illicit activities [7]