Direct Access to US Payment Channels
So what exactly are the perks of becoming an official US bank? Why would Kraken want to pursue this status in the first place? It comes down to how money is managed at a federal level, and how easily that money is moved around. By being a business, or institution there needs to be a middle layer in between the federal settlements and Kraken. This entity would be Kraken’s US Bank. Now, Kraken is free to be their own bank, giving them direct access to federal payment channels. This should allow Kraken to move quicker with USD deposits and withdrawals. It’s speculated that this could also mean that Kraken will be able to offer even cheaper rates than they already do.
Kraken Set To Steamroll Across the United States
When cryptocurrency businesses are considering opening up shop in the United States, one of the first things they realize ends up being a major deterrent. In order to operate in every one of the US states, separate documentation and registration need to be obtained. That is, every state has their own regulatory compliance measures. The fact that Kraken has become a state-chartered bank, gives them the ability to skip the application process for other states. This greatly accelerates the rate at which Kraken can further scale across the United States. From a business perspective, the value of their new status is incalculable. Kraken has saved itself hundreds of hours of paperwork.
A New Range of Opportunities
Kraken will be able to offer a range of services that its competitors cannot offer as easily. For example, Kraken can be custodians for businesses wishing to offer crypto custodianship as a service. They are also able to offer debit cards that allow users to spend their cryptocurrency directly from their Kraken account. Perhaps one of the most intriguing leg ups it has on its competitors is its proximity to securities regulators. Cryptocurrency Security Tokens is a very taboo area of the industry. One that has not properly been streamlined or tackled by a formal institution. Kraken positioning itself as a bank has the opportunity to add their own stamp of legitimacy to projects wishing to go the security token route.
A Win for All of Crypto
Regardless of where you stand within the cryptocurrency industry, this should be considered a win for the adoption of cryptocurrency. The reason being is one of the largest, most trusted, and longest running cryptocurrency exchanges gets a seat at the bankers table. When crypto anarchists imagine how to take down the banks, few consider this can be done from the inside. Instead of trying to convince any of the US banks to adopt crypto, why not just make Kraken a bank?