Bitcoin exchange Kraken has announced that financial compliance veteran Howard Bernstein has joined the company as chief compliance officer as the trading platform looks to expand to the United States.
Bernstein, who has more than 20 years of experience in American financial regulations, constructed the entire anti-money laundering program of the publicly traded investment bank Merriman Capital, Inc. He also helped Merriman comply with SEC and FINRA requirements. Much like the current state of Bitcoin regulations, the compliance requirements for the SEC and FINRA were new and very unclear at the time.
According to a Kraken blog post, Bernstein will help manage the company’s day-to-day compliance program and begin to engage regulatory officials and lawmakers. But the new CCO also marks a change of heart for the exchange about the U.S. market, a country Kraken doesn’t operate in, but which contributes greatly to bitcoin’s trading volume.
The San Francisco-based exchange previously swore off the U.S. market, having said that the country’s regulations were too nascent to know what they needed to comply with. Kraken instead focused its efforts on Europe and Japan, which it found to have simpler financial regulations.
Bernstein will now led the exchange’s efforts to get a U.S. banking partner and necessary financial licenses so the trading platform can operate in the country.
“We are working toward being able to operate legally in the United States,” Kraken CEO and founder Jesse Powell told Bitcoin Magazine. “Unlike most other services, we’ve chosen to stay out of the U.S. until we have the necessary licenses, which has put us at a substantial competitive disadvantage. We’re looking forward to entering our home market.”
He added that the new CCO is also re-evaluating Kraken’s existing compliance programs in Japan and Europe.
“We plan to better localize our compliance efforts and adjust to a more customized risk-based model, as opposed to the generalized policy we have now, which might in some cases be too strict, and in other cases not strict enough,” Powell said.
Image via Kraken.
Jeffrey Maxim is a marketer and writer studying the emerging intersection of mobile, marketing, retail and fintech. Currently living in Uruguay, Jeffrey enjoys soaking up the country’s rich culture and listening to jazz and ska in his free time. He is also a hobbyist coder learning the basics of web development. Follow him on Twitter @jeff_maxim.