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 
 
Thank you to our sponsors! 
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Episode links: 
David Kinitsky: https://twitter.com/Kinitsky
Kraken: https://www.kraken.com/en-us/
 
Kraken announcement about Kraken Financial receiving the SPDI title from the Wyoming Banking Board: https://blog.kraken.com/post/6241/kraken-wyoming-first-digital-asset-bank/
 
CoinDesk story: https://www.coindesk.com/kraken-crypto-exchange-secures-bank-charter-under-wyoming-law
 
The Block story: https://www.theblockcrypto.com/post/77804/kraken-crypto-bank-launch-wyoming
 
Kraken Chief Legal Officer Marco Santori tweet storm on the significance: https://twitter.com/msantoriESQ/status/1306236234675740672?s=20
 
Previous episode of Unchained on crypto friendly regulations in Wyoming: https://unchainedpodcast.com/eth-denver-fireside-chat-with-2-of-the-most-crypto-friendly-governors-in-the-nation/
 
OCC allowing banks to offer cryptocurrency custody services:
https://www.coindesk.com/us-banking-regulator-suggests-federal-licensing-framework-for-crypto-firms
https://www.coindesk.com/banks-in-us-can-now-offer-crypto-custody-services-regulator-says
https://www.coindesk.com/occ-crypto-custody-years
 
Conference of State Bank Supervisors’ new regulatory regime: https://www.reuters.com/article/us-usa-regulators-crypto/u-s-crypto-fintech-firms-to-benefit-from-slimmed-down-regulatory-process-idUSKBN2661OA
 
Links from news recap:
https://unchainedpodcast.com/half-a-billion-dollars-overnight/