The Federal Reserve, in an order published Friday, explained that it rejected Custodia Bank's application to become a member bank due to possible runs on the bank, among other risks. Why it matters: The state-chartered Wyoming special purpose depository institution (SPDI) has been pushing a new banking model that makes money on fees, not by investing deposits. The big picture: Two running narrative threads in crypto converge in the Custodia saga. One, that there is a coordinated effort to shut down the industry, and two, that crypto poses serious safety and soundness risk to the U.S. financial system and therefore ... (full story)