Payward Europe Solutions, an Irish subsidiary of Kraken registered in Dublin, was awarded virtual asset service provider (VASP) authorization from the Central Bank of Ireland on April 18.
The VASP authorization comes at a critical time for Kraken. The European Union is scheduled to conduct its final vote on the long-awaited Markets in Crypto Assets (MiCA) regulation.
The MiCA legislation is expected to pass after preliminary voting showed overwhelming bipartisan support. If it does, the resulting changes will require any company operating as a CASP — a crypto assets service provider — in the EU to register with one of the union’s 27 authorized regulators.
Kraken, or rather its Irish subsidiary Payward Europe Solutions, has received such qualification, becoming only the third cryptocurrency outlet so registered. Exchanges Gemini and Coinbase received their VASP authorization in July and December of 2022, respectively.
Kraken’s head of European operations, Mark Jennings, lauded the Bank of Ireland’s decision in a company blog post, stating that “Clear and effective regulation is essential for the mainstream adoption of cryptocurrencies.” Jennings also intimated that the designation was a testament to the company’s legitimacy:
“Kraken’s Irish VASP registration demonstrates to both our clients and regulators that Kraken follows Europe’s most robust anti-money laundering and compliance standards. Registration further underscores Kraken’s commitment to driving crypto adoption across Europe, now and into the future.”
Back in the U.S., the road’s been bumpier for the Kraken cryptocurrency exchange, as it was forced to settle with the Securities and Exchange Commission over alleged improprieties with its staking services. As a result of the lawsuit, Kraken paid $30 million in fines and agreed to cease offering staking services to U.S. clients.
Fast forward to April 18, and it appears that Kraken should have all of its ducks in a row to meet MiCA compliance requirements ahead of the EU vote on April 19. If the measures pass, full implementation is expected by Q3 2024, after an 18-month transition period.