Kraken Crypto Exchange is launching its own bank very soon

Crypto exchange Kraken has shared its plan to launch its own bank. Digital asset exchanges are running out of bank partners amid a regulatory crackdown by the US government. The latest developments regarding Silvergate Bank have affected the Kraken exchange’s ability to allow fiat deposits.

Silvergate Bank processed the payments for many top crypto exchanges which included Binance.US, Coinbase and Kraken. However, the recent announcements by the bank suggested that it may not be able to conduct business as usual.

The delay in the bank’s financial report created another wave of panic. Consequently, many crypto exchanges had to distance themselves from the bank at a time when bankruptcies have become the norm in crypto.

Silvergate Bank ends crypto payments

The plan to have Kraken’s own bank for crypto payments was shared by the exchange’s Chief Legal Officer, Marco Santori. The announcement by Kraken crypto comes just days after Silvergate Bank shut down the Silvergate Exchange Network. The network served the top US exchanges in processing crypto payments.

According to reports, Silvergate Capital Corp had also issued a loan to MicroStrategy for its Bitcoin purchases. However, according to Michael Saylor, the firm does not owe the loan to the bank until 2025. Silvergate’s crypto ventures made it one of the friendliest banks to the crypto industry, as other Wall Street banks stayed away from the volatile. asset class.

Kraken Crypto Exchange Pays $30 Million to SEC

Just a few weeks ago, the Kraken crypto exchange had to stop betting services for its US customers following the SEC’s instructions. The top US exchange was sued by the SEC for offering ‘unregistered’ betting services to US citizens. According to the regulator, the crypto exchange failed to disclose the underlying risks to its investors. The Kraken exchange settled with the SEC for $30 million, but did not accept or deny any charges.

According to Marco Santori, the SEC’s crackdown on betting will only divert US crypto users to offshore exchanges. This would mean exposure to much higher risk as the origin of many offshore exchanges is unknown.