Kraken's Parent Swallows a Bank Whole, Comes With EU Passporting Receipt 🏦

Payward, the parent company of crypto exchange Kraken, has agreed to acquire Lithuania-based Saldo Bank in a deal that the firm described as "a deliberate next step in an infrastructure strategy we've been building for years," making it the first digital asset company to buy a European bank, according to a Financial Times report on Wednesday. Payward signed a definitive agreement to acquire Saldo Finance Oy, a Finnish holding company whose subsidiary, Saldo Bank UAB, holds an EU banking license issued in 2021. The acquisition is subject to customary regulatory approvals and is expected to close in 2027. The price was not disclosed.

Saldo Bank offers consumer and business loans alongside retail term deposits across Lithuania, Finland, Sweden and Germany, with authorization passported into the Netherlands. "A regulated EU bank is the piece that lets us serve European clients the way a primary financial institution should: one place to hold assets, move them freely, and put them to work," Payward co-CEO Arjun Sethi told the FT. Sethi said the company intends to bring cash, crypto, tokenized stocks and credit together in a single system so customers can borrow and lend against assets without selling them. The company added that the deal will enable Payward Banking to offer interest on deposits, lending products and banking-as-a-service capabilities, including card issuance, to small and medium enterprises.

The Saldo purchase follows Payward's $600 million acquisition of Hong Kong-based stablecoin payments provider Reap Technologies in May, a transaction that included cash and stock at a $20 billion valuation, and a $550 million purchase of U.S. derivatives exchange Bitnomial in April. Payward issued shares at the same $20 billion valuation when it raised $800 million in November, just ahead of confidentially filing for an IPO. Kraken has since pushed its listing to the second quarter of 2027 at the earliest, CoinDesk reported in September, citing people familiar with the matter.

Founded in 2011 and headquartered in San Francisco, Payward applied in May for a national trust company charter from the U.S. Office of the Comptroller of the Currency, the federal bank regulator. Coinbase and Ripple have already received conditional OCC trust charters, which allow firms to custody customer assets and provide transaction services but not take deposits. This month, the Independent Community Bankers of America sued the OCC, arguing that granting such charters to crypto firms exceeds the regulator's authority, with ICBA President and CEO Rebecca Romero Rainey stating: "Any non-fiduciary firm seeking the benefits of a federal bank charter should meet the same standards as community banks." An OCC spokesperson declined to comment.

In August, Payward launched a multi-asset debit card in the United States through its Kraken payment app, Krak, allowing customers to spend crypto and fiat while earning up to 2% cashback in dollars or $BTC. The company did not immediately respond to a request for additional comment on the Saldo Bank transaction.