What a win-win for #crypto & Wyoming! As of **NOW** Kraken has a US bank charter—a 100% reserves-required, audit required (w/ #ProofOfReserves), custody via legal bailment, no #rehypothecation type of bank!🤠
2/ The vote of #Wyoming's Banking Board just concluded & it was UNANIMOUS! It took 27 months for the first #Wyoming SPDI to obtain a charter—congrats to the dozens of people who made it happen, esp @GovGordon, @TylerLindholm & Wyoming legislators & the Wyoming Division of Banking
3/ I’ll be back w/ more analysis later. Next applicant in line for #Wyoming SPDI is @AvantiBT later this Fall (more are on the way). But today is @krakenfx's day. As a shareholder, I'm so happy for @jespow & Kraken team! Applications for this charter opened a yr ago--took longer
4/ ...than expected but the outcome is just as sweet! Congrats again @krakenfx & #Wyoming!!!
QUIET PART OUT LOUD: they're rightly worried abt Hong Kong via USD stablecoins becoming a hub for USD clearing that's outside US's reach, while the US dithers. But it's not just HK. Obvious fast path for Milei to dollarize Argentina is via USD stablecoins. ft.com/content/39f101…
2/ 👇But the US (under Sen Warren's control of the Biden Admin's financial svcs policy) is blocking everyone working on regulatory-compliant USD stablecoins, while letting big banks continue to build their own versions.😡 But the world already blew past the walled-garden versions
3/ And Warren has admitted what she's really up to: she wants a retail #CBDC in the US. And since she controls the Biden Administration's financial services policy, the US is heading toward a CBDC as long as Biden remains in power.
1/ OH BOY...#PrimeTrust's failure just took a BIG turn--its receiver today filed to put it into voluntary Chapter 11 (federal bankruptcy). I was afraid for Prime Trust customers of this very outcome & discussed why in the debate w/ @mikebelshe on @zGuz's podcast last month.
2/ In that debate, I laid out why banks as legal entities better protect customers than state-chartered trust companies in the event of failure--bc the federal bankruptcy process is designed to bring assets into the estate, while bank receivership is designed to protect customers
3/ As a state-chartered trust company (not a bank), #PrimeTrust cld be dragged into federal bankruptcy--& indeed that's now happening. In that debate I mentioned case law precedents where state-chartered non-banks tried to prevent being dragged into federal bankruptcy, but lost.
1/ 🚨ON THE DAY #FedNow is scheduled to launch, I noticed something...interesting, shall we say. 🤔Among the list of banks & credit unions in the Fed-authorized 1st group of participants is a #fintech--& it's a European fintech, not even an American one. So I went digging...
2/ But wait, you're thinking, how does a #fintech even have a Fed master account so it can qualify to clear US$ payments at the Fed--isn't the Fed keeping #fintechs out???
Yes, yes it is--except for certain fintechs. Europe lets its fintechs qualify for special bank charters.
3/ And the Fed lets foreign bank branches have Fed master accounts.
Curiously, tho, the Fed let Adyen open its Fed master account in July 2020 (screenshot ^), but the Fed didn't approve Adyen's US branch until May 2021. Folks--that's..."interesting." federalreserve.gov/newsevents/pre…
1/ BIG NEWS for #fintech! A sixth US state--Idaho--is willing to charter uninsured, non-lending, 100% reserve banks that are eligible for Fed master accounts (the other states are CT, ME, NE, VT & WY). This trend could turn the "bank-as-a-service" (#BaaS) model on its head!!!!!
2/ The revelation was buried deep in the Fed's master account database (which Congress had to force the Fed to release--which it did late on a Friday afternoon before the Juneteenth 3-day weekend. Hoping no one would see it???) It's a #GiftThatKeepsGiving. federalreserve.gov/paymentsystems…
3/ Here's a recent blog post I wrote about the power of U.S. state to charter banks & federal law requiring federal bank regulators to respect the chartering decisions of the bank chartering authorities, which do the weeding out.
https://t.co/dEpudBsrYBcaitlin-long.com/why-defending-…
TWEET 🧵on state-chartered trust companies, #PrimeTrust & whether customer funds are really theirs amid a failure. I responded to the below tweet from @mikebelshe but the thread was cut up, so I'm re-posting here in whole. First, Mike's tweet & then my 11-tweet response in whole:
Mike's tweet here, asserting "it's the client's money" and "will you stop pushing the bullshit that WY is somehow special?"--@mikebelshe
1/ Mike, you're wrong. #Wyoming law is different & more customer-friendly, but let's start with your assertion that "it's clients' money." Two facts make clear that's not the case here, & then I'll discuss the failure of a state-chartered trust company where customers took a hit