Kraken’s owner is buying Saldo Bank to take deposits and lend in Europe

For most of its life, Kraken has been a crypto exchange that needed somebody else’s bank to move its customers’ money. Its owner, Payward, now wants to be that bank in Europe. The company has agreed to buy Saldo Bank, a small digital lender licensed in Lithuania, which would let it hold Europeans’ savings and lend to them under its own name.

The industry spent years being turned away by banks, and one of its oldest exchanges has decided to stop asking. The harder test comes after the paperwork. A brand built on trading volatile tokens has to persuade savers that it can be trusted with money they never intend to trade, and a European supervisor has to agree that a crypto group should own a bank.

Saldo comes with a licence that works across Europe

Saldo Bank is not a household name, and that is part of the appeal. It started out as a Finnish fintech, runs its headquarters from Vilnius and won a specialised bank licence from the European Central Bank. The Bank of Lithuania supervises it. The Financial Times reported the deal, and the companies’ announcement spells out the structure: Payward is buying Saldo Finance Oy, the Finnish holding company that owns Saldo Bank UAB.

What Payward gets is a working bank rather than an application in a queue. Saldo takes term deposits in Lithuania, Finland, Sweden and Germany and holds a passport to operate in the Netherlands. It makes consumer loans in Lithuania, Finland and Sweden, lends to small businesses in Lithuania and Finland, issues a credit card in Finland and has direct access to the SEPA euro payments system. It also supplies embedded lending to fintech companies in Finland and Germany. Under EU passporting rules, a licence granted in one member state lets a bank serve customers across the bloc without starting again in each country.

Jarkko Mäensivu, Saldo Bank’s president, framed the deal the same way: “A banking license is only as valuable as what you build on top of it.” Payward co-CEO Arjun Sethi was less modest about scale. “We are starting in the EU, and the ambition is global,” he said.

A crypto firm that no longer wants to rent its bank

The deal makes more sense against the industry’s history. When Silvergate and Signature collapsed in March 2023, crypto companies lost two of their main US banking partners within days, and many spent the following months looking for any bank that would hold their cash. Owning a licence ends that dependence, at least in Europe.

Payward has been assembling the pieces for a while. Its US unit, Kraken Financial, a Wyoming special purpose depository institution, received a limited-purpose master account from the Federal Reserve Bank of Kansas City in March, the first granted to a crypto company, which lets it settle dollar payments directly. The group also holds an e-money licence from the Central Bank of Ireland, and Payward says its banking arm has originated more than $2 billion in loans. The bank deal follows an acquisition spree that took in the futures broker NinjaTrader for $1.5 billion, the US derivatives exchange Bitnomial for up to $550 million and the stablecoin payments company Reap, which closed in July. In September, Nasdaq Ventures agreed to invest $100 million at a $21 billion valuation, and Payward has filed confidentially for a US listing.

Once the deal closes, the companies plan to offer European clients interest on deposits, lending and banking-as-a-service, including card issuing and loans to small businesses, all subject to regulatory approval. Bloomberg reported in July that Payward was in talks to buy a Lithuanian lender. The price was not disclosed, and the companies expect the deal to close in 2027 once regulators sign off.

Savers who opened a fixed-term deposit with Saldo in Helsinki or Vilnius chose a quiet online bank, not a crypto exchange. If regulators approve the deal, they will be banking with one anyway.

Tags: cryptocurrency, Kraken, Arjun Sethi, digital banking, Payward, Saldo Bank