Kraken is going to be the first cryptocurrency bank

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On Wednesday, the Wyoming Banking Board voted to approve the crypto exchange, Kraken’s application for a special purpose depository institution (SPDI) charter. Kraken is the first SPDI bank in Wyoming. According to the Wyoming Division of Banking’s general counsel, Chris Land, Kraken will be the first newly chartered (de novo) bank in the state since 2006 too.
“By becoming a bank we get direct access to federal payments infrastructure, and we can more seamlessly integrate banking and funding options for customers,” said David Kinitsky, a managing director at Kraken and the CEO of the newly formed Kraken Financial. (
In the wake of a July letter from the American Office of the Comptroller of the Currency giving national banks the go-ahead to custody crypto, the Division of Banking also announced it has been working with Promontory Financial Group, a prominent Washington, D.C.-based consulting firm made up of lawyers and former government regulators. In October, the division along with Promontory will publish the first manual for banks regarding procedures and policies for handling digital assets and cryptocurrencies, Land said.
Moreover, Kraken Financial will give Kraken the potential to operate in more jurisdictions, Kinitsky said. As a state-chartered bank, Kraken now has a regulatory passport into other states without having to deal with a patchwork state-by-state compliance plan.
Kraken has hided this application until now. The first hint the exchange was interested in the Wyoming charter was in December when it opened a position for the job Kinitsky has now.
We would expect to offer a host of new products as we get established,” Kinitsky said. “Those will range from things like qualified custody for institutions, digital-asset debit cards and savings accounts all the way to new types of asset classes. We can engage with securities and commodities and things like that as a bank. So a lot more TBD there.”
Kraken expects its major revenue drivers to be fees and services, Kinitsky said. SPDIs cannot lend, and each bank has to hold 100% of its assets in reserve. Kraken wouldn’t say how much equity capital the company raised for its application, but the Division of Banking is encouraging applicants to raise between $20 million and $30 million, similar to the equity capital kept at a de novo bank.
At first, Kraken Financial will play the same function as third-party banking relationships that Kraken has already formed, Kinitsky said. Finally, that become the U.S. customer service provider, with Kraken affiliated services offered on the back end.

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