Custodia, a crypto-focused custodian bank, has accused the US Federal Reserve of attempting to cripple crypto banks for political reasons. In a report by Decrypt, Custodia claims that the Fed's denial of its master account application was "a political decision, not a legally defensible one, designed to isolate the crypto industry." Despite the Fed's authority to reject Custodia's application, as affirmed by a recent court ruling, the bank maintains that even if it wins an appeal, no depository institution will be granted access to the Fed's systems. This highlights the ongoing tension between crypto and traditional financial institutions and the wider regulatory landscape surrounding digital assets.