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Trump Signs Executive Order Asking Fed To Evaluate Fintech's Access To Payment Accounts: Win-Win For Crypto Companies?

BY Benzinga | ECONOMIC | 12:27 AM EDT

President Donald Trump signed an Executive Order on Tuesday directing regulators to take measures to promote fintech innovation, including an assessment of extending access to Federal Reserve payment rails.

Regulators Instructed To Do Away With ‘Outdated’ Laws

The Executive Order specifically instructed the Fed to evaluate the potential for uninsured depositories and non-bank fintechs to access Fed payment accounts and services.

The Order also asked a report on the Fed’s “legal authorities” to extend such access, expansion options subject to risk management requirements, and any “impediments” that hinder direct access.

The Order noted that fintech firms help provide” low-cost and efficient access” to financial markets, creating economic opportunities for all Americans.

“The Federal government must update its outdated regulations to allow integration of digital assets and other novel financial technology into traditional financial services and payment systems,” the Order read.

Read Also: Thomas Massie Loses To Trump-Backed Ed Gallrein In The Most Expensive House Primary To Date

What’s There For Crypto Companies?

The move comes as debate intensifies about giving cryptocurrency companies direct access to the Fed's payment network.

Earlier this March, Kraken became the first cryptocurrency firm in U.S. history to obtain a Fedmaster account, granting it direct connectivity to Fedwire ? the central payment system used by thousands of American banks and credit unions.

Payments company Ripple (CRYPTO: XRP) applied for a national trust bank charter and a Federal Reserve master account last year.

However, these developments haven’t been without controversy. Rep. Maxine Waters (D-Calif.) sought further details on Kraken’s approval,  arguing that access to the nation's "critical" financial infrastructure should not be granted without complete transparency

Read Also: Elizabeth Warren Questions 'Effective Crypto Banks' By Coinbase, Ripple, Paxos

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image via Shutterstock/ noamgalai

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