10-22-2025 
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Blockchain operators focused on payment stablecoins could find it easier to obtain access to Federal Reserve master accounts, albeit ones that are on Ozempic.
- Federal Reserve guv proposes ‘skinny master accounts’
- OCC boss dismisses stablecoin ‘reward’ bank run fears
- Circle v NRA: shots fired
- Asian corporate giants back off Hong Kong stable plans
- Tokyo is bold where Beijing is skittish
- Singapore SMEs get new stable payment options
Minds were blown Tuesday at the United States Federal Reserve’s inaugural Payments Innovation Conference in Washington, D.C., when Fed Gov. Christopher Waller announced that America’s central banker was open to giving some blockchain companies access to the Fed’s coveted master account system. Or at least, something resembling access to a master account.
Blockchain firms have so far been denied master accounts, which, among other things, grant the account holder the same kind of direct access to the U.S. money supply enjoyed by banks and credit unions. At present, crypto firms have been deemed too risky to enjoy these perks, leaving them no choice but to partner with more mainstream financial institutions.
In his opening remarks to conference attendees, Waller said he’d directed his staff to explore the concept of a new type of Fed account for companies “focused primarily on payment innovations.” Such companies “may not want or need all the bells and whistles of a full-fledged master account,” so Waller wants to “tailor the services of these new firms to the needs of these firms and risks they present” to banks and the broader payment system.
Waller sketched out his prototype for a “skinny master account” that would “provide access to the Federal Reserve payment rails while controlling for various risks … Reserve Banks would not pay interest on balances in a payment account and balance caps may be imposed.”
‘Skinny’ accounts “would not have daylight overdraft privileges. If the balance in the account hits zero, payments will be rejected.” They would also “not be eligible for discount window borrowing or have access to all Federal Reserve payment services for which the Reserve Banks cannot control the risk of daylight overdrafts.”
Jaws dropped even lower when Waller suggested that the skinny accounts “would have a streamlined timeline for review.” In other words, Waller wants the Fed to double down on the current administration’s endorsement of the tech world’s ‘move fast and break things’ ethos when it comes to blockchain innovation.
Waller said his staff would “engage with all interested stakeholders,” who will definitely include all the major crypto firms looking to expand their ‘payment stablecoin’ operations while cutting out their banking middlemen. There’s also all the non-financial corporates that have been contemplating diving into this payment pool ever since the stablecoin-focused GENIUS Act was signed into law in July.
After his speech, Waller sat for an interview with Crypto in America in which he clarified that the skinny Fed accounts would only be available to firms that successfully apply for a national trust charter or have been granted special-purpose depository institution (SPDI) status in Wyoming.
OCC chief downplays stablecoins v banks fight
During his interview, Waller also weighed in on the current war between crypto operators and America’s banks and credit unions. Congress has been asked to use its pending digital asset market structure legislation to close what the banks claim are ‘loopholes’ in the GENIUS Act.
GENIUS prohibits stablecoin issuers from offering ‘yield’ to their customers, but non-issuing crypto firms like Coinbase (NASDAQ: COIN) consider themselves free to offer ‘rewards’ to their customers for holding stablecoins on their platforms.
While Waller acknowledged that this was a matter for Congress to sort out, he thinks of stablecoins as “a pure payment instrument … not a time deposit where you’re holding it to earn interest.” Waller said offering interest by calling it ‘rewards’ is “kind of skirting the spirit of the law … If Congress wanted to let you pay interest, they should have just let you pay interest. So, trying to backdoor it is a little funny.”
Banks have said they fear the higher rates offered via these ‘rewards’ will result in mass withdrawals of bank deposits, negatively impacting banks and credit unions’ ability to lend money, particularly in smaller communities served by smaller institutions. Crypto operators claim these concerns are overblown, and a major figure in the Treasury Department appears to agree.
On October 20, the American Bankers Association’s (ABA) annual conference welcomed Jonathan Gould, chief of the Office of the Comptroller of the Currency (OCC). But if they expected him to have their back in their fight with stablecoin issuers, they had another thing coming.
Gould said “If there were to be a material impact to deposits as a result of payment stablecoins … it would not happen in unnoticed fashion,” and it “would not happen overnight.” Gould added that if tangible evidence emerged of “a material flight of deposits from the banking system,” he was sure that banking associations, federal regulators and “highly elected officials … would have something to say about that.”
Gould’s position here isn’t exactly new, as he offered similar comments at a crypto-sponsored event in September. But he also added at that event that his office “will be designing a regulatory and supervisory framework to address that [threat of deposit flight] specifically.”
In his ABA comments, Gould sketched out a scenario in which community banks that embrace stablecoin payments might “break some of the dominance that exists right now among the very largest banks” handling America’s payments system.
Gould said he didn’t want payment stablecoins to become “the exclusive purview of just a handful of very large banks.” As Gould sees it, part of his role is to “make sure that we’re not creating a framework in which, again, we have this two-tier system within which only the very largest banks have the risk management sophistication, or the fortress balance sheets, such that from the supervisory perspective, they’re okay in moving forward.”
Circle v NRA
One of the more unique stablecoin news items to emerge this month is America’s gun lobby targeting Circle (NASDAQ: CRCL) for refusing to allow its USDC stablecoin to be used to purchase firearms.
On October 14, Grover Norquist’s GOP-aligned small-government advocacy group Americans for Tax Reform (ATR) issued a blog post with the title ‘You can’t buy a gun with Dem donor’s stablecoin.’ The post detailed USDC’s 15 types of prohibited transactions, which includes “weapons of any kind, including but not limited to firearms, ammunition, knives, explosives, or related accessories.”
The ATR noted that firearms are “the only legal, constitutionally-protected property right that has nothing to do with any financial risk Circle will not allow you to buy with their coin.” The ATR went on to call Circle CEO Jeremy Allaire “an avid donor to Democrats.”
While the ATR used Circle’s prohibition to illustrate the theoretical dangers of central bank digital currencies (CBDC), its cause was swiftly taken up by other firearms enthusiasts. On October 16, the National Shooting Sports Foundation (NSSF) tweeted its alarm at the claim that Allaire “backs gun control advocates in Congress,” while warning that “political bias in crypto poses a threat to your [Second Amendment to the U.S. Constitution] rights.”The NSSF, which bills itself as The Firearm Industry Trade Association, followed up with a blog post of its own on October 20 that slammed “ideological gatekeeping by crypto companies.” The post included a corporate statement from Circle that we’ll document in full (garbled syntax and all):
“Circle has always held that to the right of lawful, the use of money should be free. This includes lawful purchases of firearms in the United States, which is a Second Amendment protected right. As the GENIUS Act comes into force, Circle will work with our partners to ensure that our values continue to be reflected in our Terms. We look forward to working with merchants, banks, and the broader payment system on driving universal acceptance of regulated payment stablecoins in U.S. commerce.”
The NSSF said, “Circle’s statement is encouraging, but words alone are not enough. The proof will be in the policy changes—and in whether those changes ensure that Second Amendment commerce is treated fairly within the digital economy.” The NSSF said it “will continue to monitor Circle’s actions closely.”
Hong Kong corporate stable plans paused
In Hong Kong, some corporate giants are backing away from their plans to issue stablecoins under the special administrative region’s Stablecoin Ordinance that took effect on August 1.
On October 19, the Financial Times reported that Alibaba Group (NASDAQ: BABAF) affiliate Ant Group (operator of payment platform AliPay) and e-commerce giant JD.com (NASDAQ: JD) have both “put their stablecoin ambitions on hold after receiving instructions from Chinese regulators, including the People’s Bank of China (PBoC) and Cyberspace Administration of China (CAC), not to move ahead.”
The companies had publicly expressed their determination to explore the stablecoin space but authorities in Beijing—who previously appeared to welcome Hong Kong-specific fiscal experimentation—got cold feet after the stablecoin talk led to a raft of “illegal fundraising activities” on the Chinese mainland.
The FT also quoted former PBoC governor Zhou Xiaochuan speaking at a closed-door China Finance 40 Forum in July, during which he stressed the need to remain “vigilant against the risk of stablecoins being excessively used for asset speculation, as misdirection could trigger fraud and instability in the financial system.”
And while stablecoin proponents hype the technology’s ability to cut costs, particularly via cross-border payments, Zhou said “in reality, there is little room to cut costs in the current system, particularly in retail payments.”
The FT’s sources claimed Beijing’s concerns extended to questions of “who has the ultimate right of coinage—the central bank or any private companies on the market?” China has enthusiastically promoted the mainland use of its state-issued digital yuan but has been less clear regarding its plans for an ‘offshore yuan’ counterpart.
In late September, the Hong Kong Monetary Authority (HKMA) issued a warning that it had yet to approve any offshore yuan stablecoin. The announcement followed media reports that Hong Kong-based fintech AnchorX had launched an offshore yuan stablecoin called AxCNH.
Japan less fearful than Beijing
Across the East China Sea, three of Japan’s largest banks are preparing to jointly issue their own yen-denominated stablecoin, with a dollar-denominated token to follow at some future date.
On October 17, Nikkei reported that MUFG Bank (NASDAQ: MUFG), Sumitomo Mitsui Banking Corp (NASDAQ: SMFNF), and Mizuho Bank (NASDAQ: MZHOF) will issue their as-yet unnamed stablecoin via the MUFG-backed Progmat Coin platform. The plan is for the token to be utilized by the banks’ corporate clients before March 2026, following a proof-of-concept trial.
The banks have reportedly already enlisted the participation of trading house Mitsubishi Corp, which plans to use the stablecoin for internal financial settlements. Mitsubishi has 240 subsidiary companies that routinely engage in international transfers, an activity for which a yen-based stablecoin seems ideal.
The banking trio may not actually win the race to officially issue the first yen-backed stablecoin, with rivals ranging from Japan Post Bank to fintech outfit JPYC advancing their own plans. But unlike China’s mercurial regulatory climate, Japanese authorities appear cautiously optimistic about how things are playing out.
On October 22, Nikkei reported that Japan’s Financial Services Agency (FSA) was considering allowing its banks to launch digital asset trading services, while also mulling whether banks might be allowed to buy and hold tokens for investment purposes. The FSA will reportedly commence discussion of these possibilities on Wednesday (22).
Singapore supports retail stable use
Singapore is also not shying away from stablecoin adoption. On October 16, the Straits Times reported that local payment firms Triple-A and HitPay had teamed up to enable some 20,000 local small and medium-sized enterprises (SMEs)—both online and land-based—to accept payments in dollar-denominated stablecoins including USDC, USDT (Tether) and PYUSD, the stablecoin issued by Paxos on behalf of payments giant PayPal (NASDAQ: PYPL).
Triple-A/HitPay will convert the stablecoins to Singapore dollars at a fixed rate at the point of sale. Merchants are therefore assured of getting the full value of their product/services, with Triple-A/HitPay taking the hit from any exchange movement between the U.S. and Singapore dollars.
Overseas customers can also choose stablecoin payments at online merchants without incurring expensive conversion fees. HitPay CEO Aditya Haripurkar said the new options are “helping businesses lower cross-border payment costs by up to 50%,” while Triple-A CEO Eric Barbier added that stablecoins are “removing volatility and keeping compliance straightforward.”
The rollout follows the new stablecoin regulatory framework issued in August by the Monetary Authority of Singapore (MAS), from which both Triple-A and HitPay received operating permits.
Singapore recently earned the status of the most ‘crypto-obsessed’ country, and recent surveys have shown that six in 10 Singaporean businesses plan to accept digital assets as payment within the next two years.
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