The First Crypto Bank: What Kraken Financial Will Do and How – Ep.143


David Kinitsky, CEO of Kraken Financial, talks about Kraken’s news that it is launching a bank, after receiving approval to form a special purpose depository institution (SPDI) from the state of Wyoming. He discusses:

  • why Kraken decided to become a crypto bank, and what it will be able to do with this status
  • how this status will affect the consumer experience for crypto users 
  • what kinds of crypto assets it will be able to deal with 
  • how quickly it will list coins, such as those DeFi coins that quickly balloon to billion-dollar market caps
  • what its designation, special purpose depository institution (SPDI) means, and why that has special meaning for crypto users
  • what “bailment” means, and why that’s significant for crypto users interested in using a crypto bank and how that would affect users in the event any coins were stolen or lost
  • how Kraken Financial’s status as a crypto bank will affect the longstanding problem in the industry of obtaining and maintaining bank relationships
  • how this overlaps and works in conjunction with other recent regulations that have affected the crypto industry, such as the OCC saying banks can custody crypto assets
  • how its SPDI status will affect how Kraken Financial is regulated in New York State where the BitLicense is in effect
  • why Kraken, which has a reputation for pushing back on what it deemed to be overreach by regulators, decided to pursue the SPDI
  • how Kraken Financial will make money, despite keeping 100% reserves
  • David’s extensive background in cryptocurrency
  • the timeline going forward for Kraken Financial 


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Episode links: 

David Kinitsky:



Kraken announcement about Kraken Financial receiving the SPDI title from the Wyoming Banking Board:


CoinDesk story:


The Block story:


Kraken Chief Legal Officer Marco Santori tweet storm on the significance:


Previous episode of Unchained on crypto friendly regulations in Wyoming:


OCC allowing banks to offer cryptocurrency custody services:


Conference of State Bank Supervisors’ new regulatory regime:


Links from news recap:


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