Custodia Bank vs Fed: Former Solicitor General Paul Clement Joins Crypto Industry Fight

A week after Custodia Bank filed an appeal in the 10th Circuit Court challenging the Fed’s power to deny it a master account, former Solicitor General Paul Clement has now filed an amicus brief on behalf of the crypto industry.

Paul Clement Takes Custodia Bank vs Fed Fight Ahead

As said, in the recent Custodia Bank vs. Fed case, Paul Clement filed an Amicus brief on Wednesday, July 3, while supporting the crypto industry. Clement has gained popularity in his recent success in overturning the Chevron Defence in the Supreme Court case in the Supreme Court case involving Loper Bright fishermen.

Also Read: US SEC Takes Major Blow In Chevron Howey Test Case, Implication For Crypto

In this ongoing legal fight, The Digital Chamber (TDC) and the Global Business Blockchain Council-USA (GBBC-USA) have expressed their significant interest and unique perspective. With extensive experience in the digital assets industry, the two organizations have argued that denying state-chartered banks a reliable path to participate in the national banking just because of the involvement with digital assets will threaten the growth and success of the trillion-dollar blockchain industry.

The two organization argue that upholding the lower court’s decision will give politically unaccountable federal officials and unchecked power to stiffle innovation thereby cutting off legitimate businesses from having crucial access to the global financial system.

The District Court stated that the “Federal Reserve Bank of Kansas City (“FRBKC”) has unreviewable discretion to denynonmember depository institutionsa master account”.

TDC and GBBC argued that despite following the legal boundaries, this court decision set dangerous precedence for any industry that might fall out with the Fed officials.

Paul Clement Raises Constitutional Concerns on Fed’s Structure

In the amicus brief, the former Solicitor General has raised some constitutional questions regarding the Fed’s structure. Clement states: “In sum, by affording Federal Reserve Bank presidents significant and largely unconstrained discretionary power, the district court’s decision raises serious constitutional questions under Article II.”

“The district court’s decision threatens the dual system by granting Federal Reserve Bank officials unreviewable discretion to “effectively crippl[e]” state-chartered banks operating legally,” he added.

Also Read: Custodia Bank CEO Predicts “Rip Roaring” Bitcoin Bull Market