Kraken Wins Fed Access but Account Remains Offline

Kraken is expanding its focus beyond cryptocurrency trading into regulated banking services. Chief Executive Arjun Sethi plans to secure banking licenses in different regions over the next decade, either through acquisitions or by establishing new operations. In March 2026, Kraken Financial became the first digital-asset bank approved to access the U.S. Federal Reserve's payment system, setting a precedent for connecting crypto institutions with traditional financial rails.

Kraken has now applied for a euro-denominated banking license in Lithuania, targeting the same type of license held by Revolut as it seeks entry into Europe's deposit, payments and banking-services markets. If approved, the license would allow Kraken to broaden its financial offerings under the European Union's regulatory framework. It would also extend the company's push to transform from an exchange into a cross-regional banking institution following its March 2026 access to the Federal Reserve's payment system.

Kraken parent Payward is extending the exchange’s services into regulated banking infrastructure. Its Kraken Financial unit obtained a Wyoming SPDI charter in 2020 and, on March 4, 2026, won approval from the Federal Reserve Bank of Kansas City for a limited-purpose, one-year master account that provides direct access to the Federal Reserve’s payment systems. A federal trust charter would add a qualified custody framework at the national level.

The Office of the Comptroller of the Currency received the application on May 8, 2026. If approved, Payward National Trust Company would be established to provide services including fiduciary custody of digital assets. The Independent Community Bankers of America asked the OCC on June 8 to reject the application, citing concerns over compliance, concentration and related-party transaction risks. Payward also plans to spend up to $550 million to acquire Bitnomial and $600 million to acquire Reap.

A master account allows a depository institution to use Federal Reserve payment infrastructure directly and settle transactions through Fedwire without a correspondent bank. Kraken Financial obtained a Wyoming special purpose depository institution license in 2020 and has now become the first digital-asset bank to receive such approval, formally connecting a crypto company to the core U.S. clearing system.

The Federal Reserve Bank of Kansas City approved a Tier 3 restricted-purpose account for Payward Financial, or Kraken Financial, on March 4, 2026, with an initial one-year term. Conditions disclosed on May 8 limit the account to Fedwire and cap overnight balances. It cannot access intraday credit, discount-window funding or interest on balances, nor can it use FedNow or ACH. The cap amount was not disclosed.