Kraken Becomes a Bank After Charter Approval

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  • Kraken has been awarded a banking license by the Wyoming Banking Board
  • The license makes them the first crypto exchange in U.S. history to be legally considered a bank
  • The award could also help raise the profile of cryptocurrency companies

Kraken, one of the elder statesmen of the cryptocurrency exchange world, has been awarded a banking charter by the Wyoming Banking Board, making it the first cryptocurrency firm to become a bank. The license means Kraken can now operate with more flexibility with regard to traditional banking options for its customers, and could set a precedent for other exchanges who have had difficulty in dealing with traditional banks in the past.

Kraken the Trailblazer

Kraken published a piece on their blog regarding the awarding of the license on Wednesday, announcing that the State of Wyoming had approved their application to form “the world’s first Special Purpose Depository Institution (SPDI), tentatively called Kraken Financial.”

The move makes Kraken the first digital asset company in the U.S. to receive a bank charter and also means they are “the first regulated U.S. bank to provide comprehensive deposit-taking, custody and fiduciary services for digital assets.”

Deal Could Heighten Legitimacy of Crypto Firms

Banks were given the green light to offer digital asset custody by the Office of the Comptroller of the Currency in July, and Kraken clearly took that message to heart. No one outside the company knew that they were applying to become a regulated bank, but the fact that they have achieved this status raises the profile of cryptocurrency and helps increase its legitimacy.

Kraken Financial will also give the exchange the ability to operate in more jurisdictions, while as a state-chartered bank they now have a single regulatory ‘passport’ into other states rather than having to deal with state by state regulatory variations.