Deaton & Co. View on Significance of Custodia Bank Lawsuit for Ripple & Coinbase

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Custodia Bank recently earned a significant victory when a Wyoming Federal Judge rejected the dismissal motions presented by the Federal Reserve and the Federal Reserve Bank of Kansas City in their ongoing legal tussle. The crypto-friendly bank, founded by former Morgan Stanley executive and Bitcoin advocate Caitlin Long, had sought legal redress against the Federal Reserve for an “unlawful delay” in the consideration of their application for a master account.

The approval of this application would have given the bank access to the Fedwire network, the Federal Reserve’s payment system, which last year processed more than 196 million transactions. However, the Fed rejected Custodia’s membership application in January 2023, citing discrepancies with legal requirements and pointing to the bank’s crypto activities.

Prominent Crypto Lawyer Celebrates the Win

Renowned crypto lawyer and Ripple supporter, John Deaton, took to Twitter to celebrate the court’s ruling, terming it a significant victory. According to Deaton, Custodia Bank’s success in the court was a beacon of hope for plausible claims in the world of cryptocurrency. He argued that among the ongoing cases in the cryptocurrency space, including those involving Ripple, Coinbase, and Binance, the case of Custodia Bank stands as the most crucial.

Custodia Bank’s spokesperson, Nathan Miller, shared the bank’s delight over the ruling, expressing satisfaction that the Fed’s self-given power to override state bank charter decisions would now face the scrutiny of a federal court.

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