Two weeks ago, Kraken Financial received the first Special Purpose Depository Institution (SPDI) charter from the Wyoming Banking Division to much fanfare. With the hard work of well-known players such as Tyler Lindholm (R-Sundance) and Caitlin Long, CEO of Avanti Bank, the foundation has been established for Wyoming to be the most crypto-friendly jurisdiction in the U.S. Now that the laws are passed and the charter is issued, it is up to the Wyoming Banking Division regulators to begin the first-ever crypto bank examinations.
By way of background, I have prior experience at the Federal Deposit Insurance Corporation (FDIC) where I have examined banks in Texas, Louisiana, and Arkansas. Almost always, banks have a combination of federal and state examiners if the charter is issued by the state, with either the FDIC or the Federal Reserve as the federal regulator. If the charter is national, the Office of the Comptroller of the Currency (OCC) will examine the bank, meaning only federal regulators go on bank examinations.
However, Wyoming’s new SPDI charter for Kraken Financial creates a very unique circumstance that I believe has created ‘Unicorn Regulators’ for Fintech, who are at a historic moment in preparing for digital asset bank examinations, similarly to when the FDIC began its first exams in 1933 and the OCC started exams in 1863. I had a unique opportunity to spend some time speaking to both Commissioner Albert L. Forkner of the Wyoming Banking Division and Chris Land, General Counsel, to get an inside view of this historic moment in bank examinations. Below is my Q&A with them.
Al Forkner, Commissioner of the Wyoming Banking Division
Al Forkner
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