ICBA sends letter to Kansas City Fed requesting reassessment of Kraken's Fed account compliance

According to CryptoSlate, the community banking organization ICBA has sent a letter to the Kansas City Fed requesting a reassessment of compliance before Kraken Financial's one-year limited use Fed account expires and considering limiting or terminating the account. ICBA believes that Kraken Financial has failed to address anti money laundering and fraud risks related to encrypted affiliated entities, and cites FBI data stating that there will be approximately 13500 complaints related to encrypted ATMs in 2025, resulting in losses of approximately $389 million. Kraken obtained the account in March this year and has access to the Federal Reserve's core payment system Fedwire. The Kansas City Fed has not yet initiated the termination process.