PrintJamie Dimon Dared Crypto Firms To 'Be A Bank'? And Kraken Makes A Big Step Towards Being One
BY Benzinga | ECONOMIC | 10:48 AM ESTJPMorgan Chase & Co
One day later, Kraken became the first crypto company in U.S. history to secure a Federal Reserve master account.
Kraken Financial, the exchange’s Wyoming-chartered banking arm, received approval from the Federal Reserve Bank of Kansas City for a limited-purpose account that grants direct access to Fedwire, the core payment infrastructure used by thousands of U.S. banks and credit unions.
What The Fed Approval Means
The account lets Kraken settle dollar transactions directly on Fed rails rather than routing through intermediary banks.
For institutional clients and professional traders, that may mean faster deposits and withdrawals with less counterparty risk.
Kraken first applied for the account in 2020, spending more than five years in the queue as regulators under the Biden administration stalled crypto banking access.
The approval comes with guardrails. Kraken won’t earn interest on reserves and won’t have access to the Fed’s emergency lending facilities.
The account is structured as an initial one-year term with services rolling out in phases.
The approval is also reportedly designed as a pilot for the Fed’s proposed “skinny master account” framework, which Gov. Chris Waller is seeking to finalize by year-end.
If the model works, it could open the door for firms like Circle and Ripple (CRYPTO: XRP) that are waiting in line for similar access.
Kraken co-CEO Arjun Sethi told the Wall Street Journal the firm can now operate “not as a peripheral participant in the U.S. banking system, but as a directly connected financial institution.”
Why It Matters For Traders
The move lands ahead of Kraken’s widely anticipated IPO. The firm raised $800 million at a $20 billion valuation in late 2025.
On Polymarket, bettors give Kraken a 77% chance of completing its IPO by Dec. 31, 2026, with $1 million in total volume traded.
A separate market prices a 49% probability that the closing market cap tops $20 billion.
Coinbase remains the only major publicly traded U.S. crypto exchange, trading around $195 per share, up more than 7% today after a dismal year. A successful Kraken listing would give traders a second pure-play option.
The timing also intersects with the broader fight over stablecoin regulation.
Dimon and Armstrong clashed at Davos in January over whether crypto platforms should face bank-level oversight for paying interest on stablecoin balances.
Kraken’s Fed access may add fuel to that debate.
Image: Shutterstock
