Kraken, a US based crypto exchange, has secured approval from the Wyoming Banking Board to become a crypto bank. The Wyoming Banking Board has voted to approve an application for a special purpose depository institution (SPDI) charter of Kraken. Kraken is officially the first crypto exchange to become a bank.
The formation of the bank will allow Kraken to reduce their reliance on third-party financial institutions for services and enable the exchange to provide fiduciary services for cryptocurrencies. The bank will be regulated in largely the same manner as other US banks, and will have access to the existing federal payments infrastructure.
Kraken’s Chief Legal Officer, Marco Santori, shared the announcement via Twitter referring to the new bank as ‘Kraken Financial’:
In a blog post, Kraken stated that the headquarters of Kraken Financial will be in Cheyenne, Wyoming. Kraken Financial is the first digital asset company in US history to receive a bank charter recognised under federal and state law. Kraken clients will be able pay bills and even receive salaries in crypto. The bank plans to initially operate locally, and later extend its operations globally in the near future.
David Kinitsky, CEO of Kraken Financial, said:
“We’re thrilled to work in a state so aligned with our philosophy and values. Wyoming is a rare and shining example of how thoughtful regulation can drive innovation for FinTech companies.”
Santori further announced that Kraken Financial hopes to offer a wide variety of services to their clients including, digital asset custody, checking and savings accounts, wire transfers, trust accounts, and debit cards.
24. With @Kinitsky at the helm, Kraken hopes to offer:
-Digital asset custody
-Checking and savings accounts
-Online and mobile banking UIs
-Account management services
-Little chained-up pens; and
— Marco Santori (@msantoriESQ) September 16, 2020
The news comes soon after the Office of the Comptroller of the Currency (OCC) in the US announced that US Federal banks may provide cryptocurrency custody services for customers.