The First Cryptocurrency Bank License Is Now Granted

What services will it offer to its customers and why it is important for the entire crypto space.

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This is a historic development. A milestone in Bitcoin’s path to broad acceptance and recognition. The State of Wyoming in the US approved Kraken’s application, one of the first cryptocurrency exchanges, to establish a Special Purpose Deposits Institution (SPDI). In other words, the world’s first official bank license for digital assets was granted.

Kraken Financial, as it is called, will initially offer its services only in the USA, but will soon operate on a global scale. It will be able to do what any traditional bank does, except that it will also offer custody services for cryptocurrencies.

Why is it so important, since there is already the possibility of custody?

Because for the first time it will be for individuals and businesses, not just for institutions.

Kraken is the first newly established bank to be licensed in Wyoming since 2006. Since it is a special purpose institution, it will be obliged to maintain 100% of its deposits at all times. Not just a fraction, as is the case in traditional banks. If its customers make withdrawals, they will be able to fulfill the obligation to provide them with the money, regardless of how many loans it has outstanding.

In its first year of operation, Kraken Financial hopes to offer the following services:

  • Custody in digital assets
  • Savings accounts
  • Remittance and financing services.

Over time, it will be extended to other services, such as having its customers have a debit card powered by their deposit account in cryptocurrencies.

The impact on the crypto space

Perhaps many do not understand what this historic development signals. Kraken will be able to offer a digitally native banking experience that combines traditional values with cryptocurrencies. Users can now have a savings account that supports both government currencies and crypto.

Of course, it’s still too early to tell how it’s going to turn out. If there is simply a copy of the traditional banking system, it is not going to create some radical innovation.

What makes the project exciting is the ability to harness the advantages of cryptocurrencies to create a new, improved banking experience that will serve customers worldwide.

After all, this is their vision. To become a reliable bridge between the world of cryptocurrencies, the monetary digital future and the existing financial ecosystem.

A Natural Evolution

This is a natural evolution. Banks were created for people who wanted to hand over assets somewhere they felt confident. Banks continue to play this role to this day. As the cryptocurrency space grows and penetrates everyday life, the phenomenon will extend to crypto. There will be demand for corresponding services provided for government currencies.

There are other advantages to Kraken exchange. By owning a fully independent bank, it reduces its dependence on third-party financial institutions. It will be able to provide new innovative products to its customers. As a state-licensed bank, it now acquires the legal passport to operate in other States, without having to deal with state-by-state compliance procedures.

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