Kraken, one of the world’s largest crypto exchanges, is continuing its expansion into mainstream financial services with the launch of its peer-to-peer (P2P) payments app.
The platform, dubbed Krak, allows users to send cross-border P2P payments in both fiat and crypto. The Krak app features an attached spend account and an earnings account that offers yield generation on more than 20 digital assets.
The app puts Kraken in competition with well-established P2P players like Venmo and Cash App. In addition to their substantial customer bases, both Venmo and Cash App support crypto transactions to varying degrees.
However, Kraken’s roots in digital assets mean Krak will offer a much wider crypto scope. Users will be able to send and request payments using 300 different assets, including both crypto and local currencies.
A Tough One to Crack
Kraken’s P2P launch marks the next step in the exchange’s broader push into mainstream financial services. The company recently introduced a debit card for its UK and European customers, allowing them to spend crypto assets at millions of merchant checkouts.
While building a more comprehensive financial ecosystem is a logical step for Kraken, it’s still unclear whether the exchange’s customers have a strong appetite for crypto-based payments—whether through a debit card or P2P app.
“It’s been a tough one to crack,” Joel Hugentobler, Cryptocurrency Analyst at Javelin Strategy & Research, told PaymentsJournal. “A debit card, just like with other remittances, makes more sense when you use something that’s less volatile, like a stablecoin.”
“Accounts debited are great when you have crypto that has increased in value, but once the value of those tokens decreases, they don’t want to use the debit card,” he said. “Time will tell if they’ve cracked it, but I think they need to leverage something less volatile.”
Intent on Addition
Regardless of the traction these efforts gain, more crypto firms appear intent on adding conventional financial services. Stablecoin issuer Circle recently announced it is launching a cross-border payments network designed to connect financial institutions around the world.
International transactions were also the focus of Sling Money’s new P2P payment rail, built to serve as a bridge between local payment systems like ACH and stablecoins.
Similarly, Kraken has several products in mind for Krak. According to Reuters, Kraken plans to add physical and virtual cards, as well as loan products, to the platform soon.
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