Today, Congresswoman Maxine Waters (D-CA), the top Democrat on the House Financial  Services Committee, sent a letter to Federal Reserve Bank of Kansas City President and CEO Jeff Schmid, requesting information regarding the Kansas City Fed’s recent decision to approve a so-called “limited purpose account” for Payward Financial, doing business as Kraken Financial, a cryptocurrency exchange licensed as a Wyoming Special Purpose Depository Institution. 

In the letter, Waters notes that granting a crypto firm access to the Federal Reserve’s payment system for the first time raises policy, regulatory, and consumer protection concerns at a time when financial innovation is rapidly outpacing the rules and guardrails designed to keep the financial system safe. She underscores that access to the nation’s core payments infrastructure carries significant public responsibility and should not be extended without full transparency, clear legal grounding, and confidence that risks are being properly managed.  

“Innovations in payments, digital assets, tokenization, and even artificial intelligence are rapidly outpacing statutory frameworks developed to mitigate risk, promote competition, and protect consumers in a traditional financial environment,” wrote Ranking Member Waters. “Given this environment, much is required of those who exercise discretionary authority over safe access to, and operation of, our nation’s critical financial infrastructure.” 

At a time when Congress has debated whether or not to expand access to the Fed’s payment rails and on what terms, Waters’ letter asks the Kansas City Fed to explain what this particular approval means in practice, including what Federal Reserve services Kraken may now access, what conditions or restrictions apply, and what prudential, anti-money laundering, and consumer protection considerations were weighed before moving forward. 

Waters added: 

“The Kansas City Fed’s announcement does not disclose specific information about Kraken’s access to the range of Federal Reserve financial services ‘due to the confidentiality of business information provided by applicants.’ However, the announcement raises questions about the approval because neither statute nor the Federal Reserve Board’s Account Access Guidelines refer to a ‘limited purpose account’ type.” 

To better understand the scope and implications of the approval, Waters is requesting detailed information on whether Kraken’s account includes access to services such as FedACH®, Check Services, FedCash®, or Fedwire® Securities Services; whether the account is subject to restrictions on daylight overdrafts or overnight balances; and whether the Kansas City Fed imposed any heightened supervision, reporting, or risk-management requirements beyond those required under Wyoming law. The letter also seeks information about whether the approval was reviewed or discussed with the Federal Reserve Board, other Reserve Banks, or officials in the federal or state government, including whether any outside influence or coordination played a role in the decision and requests a written response no later than April 10, 2026. 

The full letter can be found here.