Custodia Bank, a crypto-friendly bank, is laying off staff in its ongoing lawsuit with the Federal Reserve to preserve capital

On August 30, according to Fox Business, the Biden administration's regulatory crackdown on cryptocurrencies has led to a significant restructuring of a small but highly watched crypto bank. The media learned that Custodia Bank, a Wyoming financial institution providing banking services for cryptocurrency companies, notified its employees on Thursday morning that it would lay off 9 out of 36 employees in its legal battle with the US central bank in order to preserve capital. This layoff comes at a time when Custodia is embroiled in legal disputes with the Federal Reserve over what is known as the master account, which allows state-chartered institutions to use the Fed's liquidity facilities, including payment services. Without this master account, banks are forced to do business through other institutions that have such accounts, usually resulting in high costs.