The Wall Street Journal reports that U.S. crypto exchange Kraken has become the first crypto firm to receive a master account approval from the Federal Reserve. The Kansas City Fed led the review, and parties involved expect an official announcement soon.
While the account grants Kraken some settlement capabilities akin to traditional banks, it does not come with all the privileges enjoyed by banks, such as earning interest on central bank reserves. This limited authorization is seen as the Fed’s endorsement of crypto firms’ compliance capacity.
Analysts note the Fed’s approval implies trust in Kraken’s AML and sanctions compliance frameworks, while also affirming the alignment between Wyoming’s special purpose depository institution regulatory structure and federal banking standards. The move marks a pivotal step forward for the U.S. crypto industry on the regulatory compliance front, paving the way for more digital asset firms to tap into financial infrastructure.
Kraken has not issued further comments to the media regarding the development.