The Fed just told itself to slow down. Nobody in Washington seems to have noticed.
I spent two months watching the press cover the wrong document, and I want to walk you through why.
Washington produced three things back to back: an executive order on fintech, a Federal Reserve proposal on payment accounts, and a bipartisan bill nobody was talking about. Every headline landed on the first two. America deregulating fintech. The vault opening.
I read all three documents in full before I believed any of it. Two of them are much smaller than they look. One is much bigger.
Start with the executive order. It doesn’t force the Fed to open payment accounts to anyone. It orders a review. I’ve read enough regulatory reviews to know what that buys you — eighteen months and a report, not access.
Then the Fed’s own proposal, released the very next day. Read past the press release and it tells you plainly what it is: not an expansion of who’s legally eligible for a Fed account, but a faster process for institutions already eligible — which is to say, banks. Of more than 8,000 active account holders at the Fed, exactly one non-crypto institution has ever been granted full master account access. The new account on offer here is capped, pays no interest, carries no discount window backstop. That’s not a door. That’s a service hatch with better signage.
The document actually worth your attention is the one getting almost no coverage — the PACE Act, introduced in April with real bipartisan sponsorship. It would build a genuinely new supervised category for payments companies, with an actual path to Fed account access. That’s legislative change, not administrative tidying. It’s also sitting in committee while everyone’s attention is on a signing ceremony that changed comparatively little.
Here’s the detail I keep coming back to, because it’s the one that tells you what’s really happening underneath the noise. In the same proposal where the Fed streamlines its own paperwork, it also instructs its Reserve Banks to pause decisions on riskier applicants until its policy review is finished — likely not before year end. Read that twice. The institution responsible for payment system risk has told itself to slow down, in the same document cycle where the White House is signing orders that promise the opposite. I don’t read that as a contradiction waiting to be tidied up in the next draft. I read it as the actual policy, right now, stated plainly if you know where to look.
If your payment infrastructure runs through American rails — and more UK operators are exposed to this than they’d guess, usually through a processor two layers removed from the brand they see — the question I’d be asking isn’t “is the US deregulating.” It’s which of these three documents, moving at which speed, changes who sits closer to Fedwire and FedNow, and what that does to settlement risk two steps down the chain from you.
The loudest document in the room is rarely the one doing the work. That’s true of regulation. It’s also usually true of most things that later turn out to matter.
