A bipartisan legislative initiative introduced by California Representatives Sam Liccardo and Young Kim aims to fundamentally restructure access to Federal Reserve payment rails, potentially creating new pathways for non-bank financial service providers—including those operating in cryptocurrency and digital assets. The Payment Access via Collaborative Expansion (PACE) Act represents a significant departure from traditional banking gatekeeping, where access to the Fed's real-time gross settlement systems has remained largely restricted to chartered banks and select financial institutions. By expanding eligibility criteria, the bill could democratize infrastructure that has historically been off-limits to fintech companies, payment processors, and blockchain-based platforms.
The cryptocurrency industry has largely welcomed the PACE Act as a pragmatic solution to a persistent infrastructure bottleneck. Currently, crypto exchanges and trading platforms must rely on banking intermediaries to settle transactions on the Fed's most reliable networks, introducing friction, compliance overhead, and counterparty risk. Stablecoin issuers in particular stand to benefit from direct Fed access, as it would enable them to settle transactions on the most secure settlement layer without navigating correspondent banking arrangements. This reflects a broader recognition within regulated crypto firms that infrastructure modernization benefits the entire financial system, not just digital asset operators—though traditional banking interests have historically resisted such changes to preserve their intermediate position.
The legislative approach mirrors similar efforts in other jurisdictions, notably the EU's regulatory framework around open finance and wholesale central bank digital currency systems. Rather than creating parallel payment rails exclusively for digital assets, the PACE Act takes a technology-agnostic stance, treating payment service providers as equals regardless of their underlying technology stack. This philosophy aligns with how regulators in Switzerland and Singapore have begun restructuring access to core financial infrastructure, recognizing that arbitrary technological gatekeeping ultimately weakens financial resilience and innovation capacity.
Passage remains uncertain given the complexity of Fed governance and the institutional interests involved, but the bill's bipartisan sponsorship signals genuine appetite for change beyond crypto advocacy circles. If enacted, the PACE Act could fundamentally alter the competitive landscape for payments infrastructure, forcing traditional banks to compete on service quality rather than structural moat advantages. The implications extend beyond cryptocurrency—broader fintech adoption, cross-border settlement efficiency, and the economic viability of new financial services all depend on how quickly the Fed's operational architecture catches up to market demand.