Kraken, the 14-year-old crypto exchange, is launching a new Mastercard debit card for its UK and European users.
On Tuesday, the company announced that the Krak card will offer up to 1% cash back rewards, denominated in cash or Bitcoin, with no forex or monthly fees. Krak is the exchange’s mobile app.
The card’s launch comes as Kraken also expands Vaults, an in-app savings feature which lets users earn up to 10% yield on their holdings.
Kraken’s rollout is just the latest in a growing list of crypto companies that are moving beyond buying and selling digital assets.
“To us, everything is money,” Mark Greenberg, global head of consumer at Kraken, said in a statement shared with DL News. “You should be able to use whatever assets you hold to pay for everyday goods and services in the digital era we live in.”
The neobank race
Coinbase, the publicly listed crypto exchange led by Brian Armstrong, has long offered a debit card to its users. Most recently, it was revealed that the $69 billion company was also exploring launching stock trading and prediction markets.
Likewise, the Singapore-based exchange Crypto.com offers a debit card and is expanding into stock trading and prediction markets.
Fintech firms are also expanding their offerings to attract more crypto users to their platforms. Revolut, Robinhood, PayPal, and Stripe are all exploring various blockchain technologies, including stablecoins and tokenisation.
In October, Vlad Tenev, the CEO of Robinhood, declared that tokenisation — the process of putting financial assets on a blockchain — would “eat the entire financial system.”
The objective among these companies is to provide a comprehensive financial app that lets users send and receive money, invest in a wide variety of assets, spend, and perhaps even bet on the next New York Giants game.
Crypto-first firms are banking on their early blockchain chops to carve out a slice of the market.
Kraken is no different.
10% yield
Kraken is tapping the decentralised finance market to offer users up to 10% yield on their holdings via its Vaults offering.
Unlike traditional savings accounts or even high-interest accounts, DeFi protocols offer yields higher than those of traditional banks. These yields come with different risks, too, namely smart contract vulnerabilities and liquidity mismatches between integrated protocols.
Vaults on Kraken will let users decide how far up the risk curve they want to go, as part of the company’s tailored growth strategy. Kraken did not reveal how exactly yields in its Vaults would be generated.
Along with a new card rollout and high-yield accounts, Kraken is launching a direct deposit feature for users in the EU and the UK.
Employees will soon be able to have their salaries deposited directly into the Krak app, the company said.
Liam Kelly is DL News’ Berlin-based DeFi correspondent. Have a tip? Get in touch at [email protected].
