Kraken launched a crypto-as-a-service tool on April 30 to encourage traditional financial institutions to facilitate crypto trading.
Named Kraken Embed, the new offering seeks to allow neobanks, fintechs and traditional banks to provide clients access to regulated crypto trading.
Brett McLain, Head of Payments and Blockchain at Kraken, stated the goal is to empower banks and fintechs to “adapt and thrive as crypto continues to gain mainstream adoption”.
Kraken aims to achieve this goal by leveraging its market experience, and simplifying operational and infrastructure requirements, thereby bridging the crypto knowledge gap many potential customers may have.
“Kraken is a global leader in crypto, with over 15 years of experience operating one of the world’s most liquid crypto marketplaces,” added McLain.
“Our crypto-as-a-service solution enables a wide range of financial institutions to efficiently meet growing client demand without the complexity and overhead of running their own marketplace.”
Kraken has operated in the market for 15 years, with the crypto exchange first trading in 2011. The organisation has since grown its reach, trading globally across more than 370 digital assets.
Why launch Kraken Embed now?
As noted by McLain, crypto is continually becoming more mainstream. This shift has accelerated in recent months, particularly in the US, supported by legislation from President Donald Trump’s administration.
Many traditional banking institutions have said they would rather wait for regulation before entering the crypto space. Regulation has started to take shape in recent months, with the US Federal Deposit Insurance Corporation and the Federal Reserve withdrawing two joint statements concerning banks’ crypto-asset activities.
This announcement aimed to clarify that “banking organisations may engage in permissible crypto-asset activities and provide products and services to persons and firms engaged in crypto-asset related activities.”
But momentum does appear to be growing; Bank of America expressed its interest in embracing digital currencies, particularly stablecoins, earlier this year.
Furthermore, the UK government revealed a new crypto regulatory regime earlier this week. Chancellor Rachel Reeves said: “Through our Plan for Change, we are making Britain the best place in the world to innovate – and the safest place for consumers. Robust rules around crypto will boost investor confidence, support the growth of fintech and protect people across the UK.”
Given this wave of mainstream adoption driven by regulation, Kraken believes it is the perfect time to launch its solution. The exchange has partnered with Dutch fintech Bunq, adding that more partnerships are set to be announced in the near future.
“Through Embed, Kraken is extending its deep expertise to institutions seeking a reliable, compliant and frictionless entrypoint into crypto,” concluded McLain.
“Our goal is to empower banks and fintechs globally to adapt and thrive as crypto continues to gain mainstream adoption.”
