Kraken’s UK Setup Shows Why Crypto Regulation Is More Complicated Than A Simple License
Kraken has a meaningful UK regulatory footprint, but not a single broad crypto “custody license.” It operates through multiple FCA-regulated entities with different permissions: Payward Limited is registered for AML purposes, Payward Services Limited holds an Electronic Money Institution license, and Crypto Facilities Limited is FCA-authorized for derivatives-related investment activity. These approvals cover specific functions, not all crypto services. The UK’s broader crypto regime for custody and trading is still being built, with applications expected to open on 30 September 2026 and the framework due to take effect on 25 October 2027. Until then, firms operate under a patchwork of registrations and authorizations. The key point is that “registered,” “licensed,” and “regulated” are not interchangeable. AML registration does not equal custody authorization, and none of these permissions eliminate insolvency risk or guarantee deposit-style protections. Kraken’s setup shows progress toward fuller oversight, but also why precise regulatory language matters.
