TLDR
- Circle has officially backed the Federal Reserve’s proposal for a “skinny payment account” aimed at integrating stablecoins into the U.S. financial system.
- The proposal will allow non-bank financial institutions, including stablecoin issuers, to access the Federal Reserve’s payment infrastructure.
- Circle’s support of the plan signals its commitment to using the Fed’s payment rails while maintaining transparency and segregating reserves.
- Stablecoin issuers like Circle will be able to settle transactions directly on the Fed’s payment systems without assuming banking risks.
- The new model reduces reliance on intermediary banks, allowing crypto firms to streamline payments and improve transparency.
Circle, the issuer of USDC, has officially backed the Federal Reserve’s proposal for a “skinny payment account.” This move could play a pivotal role in integrating stablecoins into the U.S. financial system. The proposal, which targets non-bank financial institutions, promises to reshape the landscape for crypto companies.
The “skinny payment account” would grant eligible firms access to the Federal Reserve’s payment infrastructure without needing a full bank charter. Stablecoin issuers like Circle stand to benefit from this framework by gaining direct access to the Fed’s clearing and settlement functions. The Federal Reserve aims to allow firms to settle transactions with transparency, all while managing reserves separately from banking operations.
Circle Role in Fed’s Narrow Payment Account Proposal
Circle has shown strong support for the Federal Reserve’s plan to introduce the “skinny payment account.” This initiative will allow firms like Circle to use Fed payment rails without taking on full banking operations. Circle’s USDC is a prime example of a fully reserved stablecoin, designed for payments rather than credit creation.
🚨BREAKING: Circle Backs Fed “Skinny Account” — A Door Just Opened for Ripple Bank & Crypto to Plug DIRECTLY Into Fed Payment System 🇺🇸🔥@circle has officially backed the Federal Reserve’s proposal for a “skinny payment account” — a limited Fed account that would give… https://t.co/MEpmsYQ4NL pic.twitter.com/MlxPV9iy4u
— Diana (@InvestWithD) February 9, 2026
The proposal would enable non-bank institutions, including stablecoin issuers, to bypass traditional banking structures. Circle’s backing of the plan signals its alignment with the idea of a regulated, payment-focused crypto model. It also sets the stage for other crypto-native firms to integrate into the U.S. financial system.
Impact of Fed’s Proposal on Crypto Firms
The Federal Reserve’s proposed payment structure opens doors for a broad range of crypto companies. By simplifying access to the Fed’s payment infrastructure, the “skinny payment account” lowers regulatory barriers. Firms such as Ripple could potentially benefit, as they are already in the process of obtaining approval for banking status.
Under this model, crypto firms can access payment services like Fedwire and FedNow without needing to undergo the costly and time-consuming process of becoming commercial banks. This streamlines payments, reduces reliance on correspondent banks, and enhances transparency. Crypto firms can now directly access settlement and liquidity functions, staying focused on payments rather than lending or banking risks.
Reduced Reliance on Traditional Banking for Crypto Payments
The Fed’s plan also addresses the ongoing issue of reliance on intermediary banks for stablecoin issuers. Currently, stablecoin firms depend on correspondent banks to access U.S. dollar clearing systems. This dependency introduces counterparty risks and regulatory bottlenecks that slow down crypto payments.
By providing direct access to the Federal Reserve’s payment infrastructure, stablecoin issuers can bypass these intermediaries. This change would reduce the delays and counterparty risks associated with traditional banking systems. Crypto companies could settle transactions more efficiently while maintaining full oversight from regulators.
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