Crypto-Friendly Bank Custodia Bank Cuts Staff to Preserve Capital Amid Ongoing Lawsuit with Fed

The Biden administration's regulatory crackdown on cryptocurrencies has led to a major restructuring at a small but high-profile crypto bank. Custodia Bank, a Wyoming financial institution that provides banking services to cryptocurrency companies, notified employees Thursday morning that it would lay off nine of its 36 employees to preserve capital amid its court battle with the U.S. central bank. The layoffs come as Custodia is embroiled in a legal dispute with the Federal Reserve over so-called master accounts, which allow state-chartered institutions to access the Fed's liquidity facilities, including payment services. Without a master account, banks are forced to conduct business through other institutions that have master accounts, which often incurs high costs. Custodia executives blamed the layoffs on what they call the U.S. federal government's "Operation Chokepoint 2.0," as they see it as a coordinated move by the Biden administration to cut the industry off from the broader banking system. (Fox)