Fintech company Bunq joins forces with Kraken to roll out cryptocurrency services
In a significant move, European neobank Bunq has partnered with U.S.-based crypto exchange firm Kraken to expand its services and venture into the world of cryptocurrency trading. This partnership, announced recently, will allow Bunq's users to trade over 300 cryptocurrencies, including bitcoin, Ethereum, and Solana, directly from the app.
The collaboration between Bunq and Kraken is facilitated by Kraken's turnkey, regulated solution, Kraken Embed. This tool enables partners to integrate crypto trading on their own platforms, thus accelerating Bunq's entry into the crypto market in Europe.
Kraken, on the other hand, is actively expanding its presence, focusing on the European Economic Area (EEA), the U.K., and the U.S. The company has secured regulatory authorizations such as Ireland’s MiCA license and Canada’s Restricted Dealer license, which enable them to operate in over 30 regions.
In addition to crypto services, Kraken is also rolling out new products like commission-free equities trading, tokenized assets, and global money apps. They have also launched regulated U.S. derivatives offerings and integrated CME-listed crypto futures trading, indicating a strong focus on regulated product expansion.
The partnership between Bunq and Kraken is part of a broader strategy to embed crypto trading capabilities into established banking and fintech platforms across key markets. This strategy is evident in Kraken's launch of Kraken Embed with partners like Bunq and Alpaca, aiming to extend similar compliant crypto trading solutions to banks, fintechs, and platforms in both Europe and the U.S.
Bunq, however, is not directly connecting its crypto endeavor to its U.S. launch. The neobank had previously pulled back its request for a U.S. banking permit due to issues between its Dutch regulator and the Federal Deposit Insurance Corp. But in early March 2023, CNBC reported that Bunq has filed for broker-dealer registration in the U.S. as an initial step before securing a full banking license.
The U.S. market, with expectations of easing regulations, is attracting neobanks like Bunq. These financial institutions are targeting digital nomads, expats, international entrepreneurs, and remote professionals from the EU or the U.S. with deep ties on both sides of the Atlantic.
It's worth noting that Kraken has faced allegations of operating an unregistered exchange, broker, dealer, and clearing agency in the past. However, the Securities and Exchange Commission dropped a November 2022 case against them. Kraken recently acquired futures trading platform NinjaTrader for $1.5 billion, further strengthening its position in the crypto market.
For Bunq, the success of this new venture will be measured not by customer acquisition but by its Net Promoter Score. The spokesperson noted that if Bunq's Net Promoter Score is high, they will know they are on the right path and can start being more ambitious with future releases. This approach underscores Bunq's commitment to providing a user-friendly and seamless experience for its customers.
Bouquet of services is expanding for Bunq, encompassing commission-free equities trading, tokenized assets, and global money apps, following their partnership with Kraken, a fintech company dominant in the crypto market. This collaboration, pivotal in the integration of crypto trading on Bunq's platform, is a testament to Bunq's intent to establish a foothold in the evolving world of technology-backed finance.
