Kraken

Kraken is a full‑service cryptocurrency exchange and institutional platform founded in 2011. Operating in Europe through Irish entities, Kraken’s primary business model spans spot and margin trading, derivatives for eligible clients, OTC/RFQ, staking outside the U.S., and institutional custody. In June 2025, Kraken secured an EU‑wide MiCA CASP authorization via the Central Bank of Ireland, enabling passported services across the EEA, complemented by an Irish EMI license for payments. With deep euro liquidity and a long security track record, Kraken is a reliable choice for European users seeking regulated access to crypto markets. Reviews of the pro platform generally note strong execution on major pairs; scalpers find the order books competitive on BTC/ETH, with performance on thin pairs more variable.

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Note on fees: Kraken Pro uses a transparent, tiered maker/taker schedule (base 0.16%/0.26% on spot; lower at higher volumes). Kraken Futures uses a volume‑based grid (from 0.02%/0.05%), with hourly funding on perpetuals. Holding a fixed‑maturity contract to settlement incurs a taker fee. Network withdrawals are asset‑based; EUR funding via SEPA is typically free, with method‑specific minimums.

Key differentiators include EU passporting under MiCA, euro rails with no‑fee SEPA deposits, robust Proof‑of‑Reserves with user‑verifiable trees, and SOC 2‑attested institutional custody. Execution quality on majors is competitive, and APIs are well‑documented for systematic traders. OTC/RFQ supports block liquidity and, in select jurisdictions, RFQ‑based crypto options for eligible clients.

Leadership, backing, and strategic context: Kraken is led by co‑CEOs David Ripley and Arjun Sethi. Recent moves signal multi‑asset ambitions (including U.S. equities via a registered broker‑dealer) and a derivatives push in Europe under a MiFID framework obtained through a CySEC‑regulated investment firm. The firm’s European footprint positions it to benefit as non‑compliant providers retrench under MiCA.

Company History & Development

Kraken emerged in the post‑Mt. Gox era with a security‑first ethos, building a reputation among European traders for euro liquidity, conservative risk management, and proactive compliance. Early milestones included benchmark data distribution to professional terminals and a steady expansion of fiat rails and asset listings. In 2019, a pivotal acquisition of London‑based Crypto Facilities brought FCA‑supervised crypto derivatives and index capabilities into the group, laying the groundwork for a broader institutional product stack and the rebranding of the derivatives venue as Kraken Futures.

Through the following years, Kraken invested in resilience—refactoring the matching engine, expanding order types and APIs, and implementing Proof‑of‑Reserves with user‑level verification. The 2021 acquisition of Staked added non‑custodial staking infrastructure to complement the existing custodial offering, further diversifying revenue and institutional services. Regulatory rigor became central to strategy: the company accumulated VASP/CSP registrations in multiple EU states, an Irish EMI license for payments, and sustained engagement with supervisors as MiCA moved from proposal to implementation.

The 2024–2025 period marked another strategic step: an EU MiFID path (via a Cypriot investment firm) to support a regulated European derivatives rollout; an agreement to acquire NinjaTrader to deepen futures technology and distribution; and the launch of U.S. equities trading through a registered affiliate. In June 2025, Kraken received a MiCA CASP authorization from the Central Bank of Ireland—the CBI’s first under MiCA—unlocking EEA passporting for core crypto‑asset services. In parallel, the firm navigated regulatory challenges: it ended on‑chain staking for U.S. clients after a 2023 SEC settlement; Dutch authorities publicized an enforcement action related to pre‑registration activity, followed by successful registration of a Netherlands entity in 2024. Security‑wise, Kraken disclosed and remediated an isolated deposit bug in 2024 with no client losses, and continued raising the bar with quarterly PoR attestations and SOC 2 reporting for custody.

Business Model & Core Services

Kraken monetizes primarily through trading fees on spot, margin, and derivatives, with volume‑tiered discounts favoring active traders and institutions. The platform lists a broad range of cryptoassets with deep majors (BTC, ETH) and expanding long‑tail coverage. Margin on spot is available on selected pairs for eligible clients, while the derivatives venue offers perpetuals and dated futures with portfolio margining and up to high, exchange‑standard leverage.

Institutional lines include Kraken Prime, OTC/RFQ for block execution, and Kraken Custody—qualified custody with segregated, on‑chain‑verifiable vaults, MPC/HSM key management, governance controls and audit attestations. Staking services remain available to non‑U.S. clients and to institutions via custody workflows. Beyond crypto, a U.S. broker‑dealer affiliate provides commission‑free trading in listed equities and ETFs to eligible states, reflecting a broader multi‑asset strategy that still keeps crypto at the core.

Regulatory Compliance & Trust

Under MiCA, Kraken’s Irish CASP license provides EEA passporting for core crypto‑asset services. The group also holds an Irish EMI license for payments, and—critically for EU derivatives—has established a MiFID pathway via a CySEC‑regulated investment firm to offer regulated futures/perpetuals in selected EU markets (availability may vary by country). GDPR‑aligned privacy notices and ongoing transparency initiatives—quarterly Proof‑of‑Reserves with user verification, and SOC 2 examinations for custody—bolster trust. Historical U.S. actions (the 2023 staking settlement) and Dutch supervisory enforcement underscore a mature compliance posture that evolves with changing rules. Retail crypto‑derivatives remain restricted in the U.K.; within the EU, MiFID oversight and local conduct rules still apply.

Economics & Value Proposition

For active traders, Kraken Pro’s tiered maker/taker pricing is competitive among regulated venues; futures/perps fees are industry‑standard at entry levels and sharpen materially with volume, supporting market‑making and algorithmic strategies. Retail app flows (Buy/Sell/Convert) include spreads for price certainty, while SEPA rails keep euro funding friction low for EEA users. Custody for on‑exchange balances carries no holding fee, and institutional custody is positioned as a premium, audit‑attested service integrated with OTC and Prime.

Accessibility is a strength for European users: no account minimums, low‑cost fiat rails, and clear eligibility gating for margin and derivatives. Versus ultra‑low‑fee offshore competitors, Kraken emphasizes security, supervision, and transparency. For institutions, integrated custody‑to‑execution, OTC options via RFQ in select jurisdictions, and portfolio margining offer a cohesive, compliant workflow.

Technology & User Experience

Kraken’s stack prioritizes reliability and latency management, with observed throughput and uptime targets that reflect continuous scaling under stress. Kraken Pro delivers advanced charting, depth tools, multiple order types, and post‑only controls for maker execution. Mobile apps mirror core functionality for on‑the‑go management, while REST and WebSocket APIs support systematic trading, real‑time data, and account telemetry. Customer support is responsive and multi‑channel, with dedicated teams for OTC, institutions, and high‑tier clients. Innovation continues in risk systems—hourly‑funded perps, an equity protection/liquidation process, and a dedicated liquidity pool to reduce unwind risk—backed by transparent index and funding benchmarks.

Scalping‑Friendliness (Commissions, Leverage & Slippage)

For scalpers, Kraken Pro’s post‑only and fee‑tiering enable maker strategies, while perps/futures maker fees and rebates (at higher tiers) are favorable for liquidity providers. On majors, user feedback and public depth snapshots suggest tight spreads and low slippage; on thin alts, fills can be more variable. Spot margin (up to exchange‑standard levels on supported pairs) and derivatives (up to high leverage on perps/futures) provide tactical flexibility, but strict risk controls and liquidation engines can trigger rapidly in volatile windows. App‑based instant orders include spreads and are not optimal for scalping; the Pro interface and APIs are better suited. Occasional user reports note degraded performance during extreme spikes—best practice is to size conservatively, use post‑only, and monitor system status.

Derivatives Trading & Fees

Kraken offers perpetual and fixed‑maturity futures to eligible clients, with entry‑tier fees around industry norms and substantial reductions for volume tiers. Perpetuals settle funding hourly to align with spot, while dated futures can incur a taker fee at settlement if held to expiry. Leverage scales up to exchange‑standard maxima, with portfolio margining, maintenance thresholds, and an equity‑protection process that avoids negative balances. Liquidation, assignment, and an exchange‑funded liquidity pool minimize disorderly unwinds. In the EU, these products are offered within a MiFID framework via an EU investment firm; availability and leverage may vary by member state. Compared with spot, derivatives fees are typically lower at the same activity level, with maker incentives benefiting market‑making and high‑frequency flow.

Security & Risk Management

Security is a core differentiator: the majority of client crypto is stored offline; operational controls span MPC/HSM key management, role‑based policies, and whitelisting. Kraken runs recurring, user‑verifiable Proof‑of‑Reserves and has completed SOC 2 examinations over custody and funding services. A 2024 deposit bug was disclosed and remediated without client losses, illustrating responsive incident handling. For derivatives, margining and liquidation processes protect portfolios from going negative, with hourly mark/funding and backstops to reduce systemic risk. Insurance arrangements and audit attestations vary by product; institutions can align custody governance with internal policies through segregated vaults and on‑chain transparency.

Market Position & Suitability

Kraken best fits European retail investors who value regulated access, euro rails, and transparent custody practices; active traders who want robust Pro tooling, competitive perps/futures pricing, and reliable APIs; and institutions requiring qualified custody integrated with deep OTC liquidity. Algorithmic users value the post‑only/maker route and stable APIs, while conservative users may prefer instant flows despite spreads. Trade‑offs include base spot fees higher than ultra‑low‑fee offshore venues and variable liquidity on long‑tail assets; derivatives access is eligibility‑ and jurisdiction‑dependent. Users seeking the absolute lowest fees or exotic instruments may compare offshore platforms, but should weigh regulatory protections and funding options.

Conclusion

Kraken’s European posture—MiCA authorization, Irish EMI, and a MiFID path for derivatives—anchors a compliant, scalable offering for the EEA. Combined with recurring Proof‑of‑Reserves, SOC 2‑attested custody, and robust market infrastructure, it presents an industry‑leading trust profile. The platform excels on majors, institutional workflows, and transparent economics; it is still building depth and throughput on thinner assets and during peak volatility. As MiCA matures and EU supervisors harmonize expectations, Kraken is well placed to consolidate share among users who prioritize regulated access, safety, and execution quality. For European beginners through professionals, and for institutions needing custody‑to‑execution continuity, Kraken remains a strong, future‑ready choice.

Last updated: September 20, 2025