SoFi and Payward join forces to connect banking networks to Kraken trading platforms

What does the cooperation between SoFi and Kraken cover?

SoFi Technologies and Payward have reached an agreement to connect SoFi's banking infrastructure with Kraken's digital asset trading platform, providing institutional clients with another way to move dollars and manage liquidity during non-traditional banking hours. Under the agreement, Payward will join the SoFi Exchange Network (SEN), a real-time settlement system designed specifically for large corporate banking customers. Kraken will also launch SoFiUSD, while SoFi will use Kraken Prime as an additional source of digital asset liquidity for transactions executed through the SoFi app. The arrangement allows institutional users on both networks to settle U.S. dollar transactions 24 hours a day, seven days a week. This helps close the operational gap between the crypto market, which is traded around the clock, and the traditional banking system, which still relies heavily on weekday settlement windows.

Payward, said: "Capital and markets are merging into a new financial paradigm, and its underlying infrastructure must keep pace. Millions of people will buy their first crypto assets in existing apps they use to receive paychecks, and the infrastructure supporting this experience should connect it to a deep and highly liquid market designed to operate at scale."

Why is $24/7 settlement important?

As exchanges, market makers and institutional trading desks operate around the clock, real-time access to the U.S. dollar has become an important part of the crypto market infrastructure. If a company needs to add collateral or rebalance liquidity over the weekend and its bank provider cannot transfer funds until the next business day, the company may face delays. Connecting Kraken to SoFi's settlement network provides institutional customers with another way to move their dollars without waiting for a regular payment window. In addition, this has also brought SoFi closer to Kraken's transaction infrastructure as banks and fintech companies compete to provide payment channels for digital asset companies.

The launch of SoFiUSD has further strengthened the ties between the two companies. Listing the token on Kraken expands its distribution and makes it easier for customers to convert between tokenized dollars and digital assets within the exchange. For SoFi, Kraken Prime provides an additional source of liquidity for crypto transactions provided by its consumer apps. As the volume of activity increases, especially when liquidity is dispersed between exchanges and market makers, gaining access to another institutional trading venue can improve execution capabilities.

Investor revelation

The focus of this deal is not to add another crypto trading function, but to connect the banking system, stablecoins and institutional liquidity. If SoFi can achieve round-the-clock dollar settlement and capture crypto liquidity from Kraken, it can narrow the operational gap between traditional banking and the 24-hour open digital asset market.

How important is cryptocurrency to SoFi's business?

SoFi launched its switching network in April this year, along with its large corporate banking business, bringing corporate services banking services and digital asset operations into a more connected infrastructure model. In the second quarter, crypto transaction revenue reached US$134.3 million, a month-on-month increase of 10%. Although this is still a small part of SoFi's $1.2 billion adjusted net income, the partnership shows that the company continues to invest in crypto-related infrastructure rather than viewing digital assets as a retail transaction function. Future economic benefits may come not only from transaction fees, but also from payments, liquidity and institutional services. A banking network capable of serving exchanges and trading companies around the clock promises to build deeper relationships with corporate customers who require both traditional accounts and access to digital asset markets. If SoFiUSD gets more listing and settlement integrations beyond its own products, its effectiveness may be further enhanced. When stablecoins can be transferred between multiple platforms and redeemed through reliable banking channels, they often become more valuable to institutional users.

Why is Payward expanding beyond Kraken?

The agreement is also in line with Payward's strategy to expand from the Kraken Exchange into a custody, payment and regulated financial infrastructure. In May, Payward applied to the Office of the Comptroller of the Currency (OCC) for a National Trust Company charter to establish Payward National Trust Company. If approved, this structure could provide custody and other regulated services to institutional customers. Payward's Wyoming chartered bank Kraken Financial obtained the Federal Reserve's master account in March this year, giving it direct access to the central bank's payment system. This access can reduce reliance on intermediary banks for certain payment functions and enhance Payward's ability to build infrastructure around U.S. dollar settlement.

Taken together, the SoFi protocol, trust charter applications, and Kraken Financial's access to the Federal Reserve's payment system point to a business model that far exceeds exchange fees. Payward is increasingly building connections between banking channels, institutional transactions and crypto custody, while SoFi is leveraging digital assets to deepen its enterprise-service banking offers. As a result, both companies are trying to control more of the infrastructure behind crypto transactions than just the customer-facing transactions.