[U.S. Court Upholds Federal Reserve Decision, Rejects Crypto Bank Custodia's Request for Rehearing on Master Account Application] According to The Block, the U.S. Tenth Circuit Court of Appeals rejected Custodia Bank's request for an en banc rehearing with a 7-3 vote, upholding the October 2025 panel decision that the Federal Reserve has the authority to approve or deny master account applications from eligible institutions. Notably, just a few days ago, the Kansas City Fed granted Kraken the first limited crypto master account, while the Federal Reserve is also working on a broader 'streamlined master account' framework. Custodia is a Wyoming-chartered special-purpose depository institution founded by Wall Street veteran Caitlin Long. The company first applied for a master account in October 2020. The Kansas City Federal Reserve Bank confirmed in early 2021 that the application had 'no significant issues,' but ultimately denied it in January 2023, citing concerns over the bank's business model focused on cryptocurrency. Custodia filed a lawsuit in June 2022, initially targeting the 19-month delay in the approval process, later arguing that the Monetary Control Act grants any eligible depository institution the legal right to obtain a master account. Courts at all levels have dismissed the lawsuit.