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In our comprehensive Kraken exchange review, we talk about its key features, pros and cons, how it stands against the competition, and all the other things you need to know.
Key Takeaways
- Kraken is one of the world’s first crypto exchanges.
- It offers diverse services, including an NFT marketplace and staking.
- Users can engage in margin and futures trading.
- The platform has a user-friendly interface perfect for beginners.
- Experienced traders can use the Kraken Pro app with more advanced trading features.
- A notable issue is the U.S. SEC’s November 2023 lawsuit against Kraken.
- Show Full Guide
What is Kraken?
Kraken, a cryptocurrency exchange headquartered in San Francisco, was co-founded in 2011 by Jesse Powell and Thanh Luu. Before that, Powell worked at Mt. Gox, the largest Tokyo-based Bitcoin exchange at the time. Under Powell’s leadership, Kraken became the world’s third-largest crypto exchange by trade volume, trailing only Binance and Coinbase.
Available in over 190 countries, Kraken offers its more than 10 million customers the ability to buy, sell, and hold over 200 different cryptocurrencies. The platform supports transactions in 8 different fiat currencies and can be accessed through both the Kraken mobile app and its website.
Kraken caters to a diverse user base with two distinct platforms: the Kraken app for general users and Kraken Pro for more advanced trading.
What is Kraken Pro?
Kraken Pro is a more advanced cryptocurrency trading platform offering a range of extra features, including spot trading, margin trading, futures trading, and crypto staking.
It boasts advanced market data analysis tools and customizable charts, providing a comprehensive, all-in-one interface that allows users to switch seamlessly between different trading modes and portfolio tracking.
The platform supports advanced order types and instructions like stop loss, take profit, reduce-only, and various trigger options.
Signing up for Kraken Pro is free, and the trading fees vary based on the user’s 30-day trade volume.
How to Open a Kraken Account?
Opening an account with Kraken is straightforward and can be accomplished in a few simple steps using your laptop:
- Go to kraken.com on your laptop’s web browser.
- Click on the “Sign Up” button.
- Choose the type of account you want to create – personal or business.
- Fill in your email address, choose a username, set a password, and specify your country of residence.
- An OTP (One-Time Password) will be sent to your email address; enter it to proceed.
- Select your preference between Kraken and Kraken Pro.
- Before you can buy, sell, or withdraw cryptocurrency, you’ll need to complete the account verification process, which requires submitting an I.D. and a selfie.
To open a Kraken account using your smartphone:
- Download the “Kraken” app from the Apple App Store or Google Play Store.
- Open the app and click on the “Create account” option.
- Provide your email address.
- Create a unique username for your Kraken account.
- Set a secure password for your account.
- Select your country of residence.
- An OTP will be sent to the email address you provided. Enter it to proceed.
- Complete the identity verification process as required by Kraken.
Verification Levels at Kraken
Kraken requests the following information from its clients for verification purposes:
- Name
- Date of birth
- Address
- Phone number
- Income sources
- Wealth sources
- Occupation
- Government-issued photo I.D.
Users on Kraken get verification levels depending on the amount of personal information they submit to the exchange.
There are three verification levels – express, intermediate, and pro – based on which your deposit and withdrawal limits and other features will be set.
Here is a table to understand Kraken’s verification levels:
| Requirements | Express | Intermediate | Pro |
| Full name, email, date of birth, phone number, address, occupation, and social security number (for U.S. clients) | ✅ | ✅ | ✅ |
| Valid ID, proof of address, Face photo | ❌ | ✅ | ✅ |
| KYC questionnaire, Sign-in 2FA | ❌ | ❌ | ✅ |
And for extra details:
What Does Kraken Offer?
Kraken provides a wide range of features catering to diverse crypto needs:
- 200+ Cryptocurrencies Listed: You can choose to stay true to your Bitcoin maximalist roots or let your altcoin energy run free with over 200 cryptocurrencies to choose from. You will have access to popular cryptos like BTC, ETH, and XRP, as well as exotic tokens like Celestia (TIA), Sui (SUI), and Blur (BLUR). Crypto enthusiasts can even place listing requests for a particular token on Kraken.
- Cash Withdrawal Options: The platform supports convenient and swift crypto-to-fiat conversions and withdrawals in multiple currencies, including USD, EUR, CAD, AUD, GBP, CHF, and JPY.
- Token Withdrawal Flexibility: Kraken emphasizes the importance of cryptocurrency ownership by allowing users to withdraw tokens to their self-custodial wallets. This feature is supported on numerous blockchains, including Bitcoin, Lightning Network, Ethereum, Arbitrum, Cardano, Avalanche, Polkadot, Stacks, and more.
- High liquidity: As one of the world’s most popular crypto exchanges, Kraken boasts high trade volumes and sufficient liquidity, often allowing for spreads as tight as 1 point per percentage (depending on market conditions).
- Competitive Trading Fees: The fierce competition in the crypto exchange sector has resulted in low trading fees offered by most crypto exchanges. Trading fees on the platform can go as low as 0% for high-value trades on its Kraken Pro platform.
- Margin Trading: Kraken Pro users get leverage up to 5x on 100 cryptocurrencies, allowing them to increase their market exposure beyond their account balance.
- Futures Trading: Through Kraken Pro, traders can engage in futures trading, taking long or short positions with perpetual futures contracts. This feature allows users to hedge against spot market positions and take advantage of market volatility.
Other Key Kraken Features
In this section, we will explore the advanced features of the Kraken trading platform that distinguish it from other cryptocurrency exchanges.
- NFT Marketplace: Kraken provides a comprehensive web3 experience with its NFT marketplace. Here, users can buy, own, and sell non-fungible tokens (NFTs). The Kraken NFT marketplace supports three major blockchains – Ethereum, Polygon, and Solana, allowing users to explore trending digital collectibles in one place. Notably, Kraken offers zero gas fees for trades on its NFT marketplace.
- Crypto Staking: Simplifying the staking process, Kraken enables users to earn interest on their idle cryptocurrencies directly on the platform. It offers staking services on over 15 cryptocurrencies, including BTC, Kraken offers a detailed look into crypto staking, We will discuss crypto staking on Kraken in detail later in this review.
- Over-the-Counter (OTC) Desk: Kraken’s OTC services cater to traders seeking to execute large trades exceeding $100,000. This service offers tighter spreads and personalized support, making it ideal for institutional clients and high-net-worth individuals on the hunt for new Kraken listings.
- Kraken Account Management Program: Advanced traders benefit from the Kraken Account Management program, which provides near real-time and personalized support. Frequent Kraken traders are assigned their own dedicated account representative.
- API Trading: Kraken facilitates API trading, allowing users to connect and manage their Kraken accounts using third-party software. This functionality empowers traders to utilize custom code for market analysis and set up automated algorithmic trading strategies, making it particularly attractive to high-frequency traders and arbitrageurs.
- Kraken Fee Credits (KFEE): KFEE are internal tokens exclusively used to pay for trading fees on the platform. These tokens hold a fixed value, with 1,000 KFEE tokens equivalent to $10 of trading fees. Kraken occasionally offers KFEE tokens – which do not have an expiration date – to its customers for various reasons.
Staking Cryptos on Kraken
Staking is the process of depositing your proof-of-stake (PoS) cryptocurrency to earn interest. This process typically entails depositing your tokens into a staking smart contract that exists on-chain.
Traditionally, crypto investors have staked their tokens through decentralized finance (DeFi) platforms using self-custody wallets. However, cryptocurrency exchanges like Kraken offer a more convenient and user-friendly staking experience by integrating it into their comprehensive trading platform. This streamlines the staking process, making it easily accessible and hassle-free for customers, all within a single platform.
Crypto staking is accessible through the Kraken Pro app and website, offering users two staking options:
- Flexible Staking: With this option, you can instantly withdraw your principal and interest.
- Bonded Staking: Bonded staking comes with a waiting period of 3 to 28 days before you can withdraw your principal and interest.
Both staking options provide the benefit of auto-compounding, as the interest earned is added to your staking balance. Kraken pays interest on staked assets twice a week.
Kraken offers staking for a variety of cryptocurrencies, each offering different yields depending on your chosen staking option.
| Staked cryptocurrency | Flexible staking annual percentage rate (APR) | Bonded staking APR | Unbonding period, if applicable |
| Algorand (ALGO) | 1% – 4% | Not applicable (N.A.) | NA |
| Cardano (ADA) | 3% – 6% | NA | NA |
| Cosmos (ATOM) | 7% – 11% | 17% – 21% | 21 days |
| Ethereum (ETH) | Variable | 3% – 6% | Variable |
| Flare (FLR) | 0.1% – 2% | NA | NA |
| Flow (FLOW) | 1% – 4% | 6% – 10% | 14 days |
| Kava (KAVA) | 7% – 9% | 12% – 17% | 21 days |
| Kusama (KSM) | 5% – 9% | 13% – 18% | 7 days |
| Mina (MINA) | 8% – 14% | NA | NA |
| Polygon (MATIC) | 1% – 3% | 3% – 6% | 3 days |
| Polkadot (DOT) | 8% – 12% | 15% – 21% | 28 days |
| Secret (SCRT) | 9% – 13% | 21% – 26% | 21 days |
| Solana (SOL) | 2% – 4% | 5% – 7% | 3 days |
| Tezos (XTZ) | 4% – 7% | NA | NA |
| The Graph (GRT) | 2% – 4% | 5% – 10% | 28 days |
| Tron (TRX) | 1% – 4% | NA | NA |
According to our Kraken crypto review, here are the four important points to consider when staking cryptocurrencies on the platform:
- Crypto staking on Kraken may not be available in specific jurisdictions, including the United States.
- Unlike some platforms, ETH staking rewards on Kraken are not auto-compounded.
- Kraken targets a commission of 15% based on the rewards you receive from on-chain staking activities.
- When opting for flexible staking, Kraken will stake up to 50% of the assets you choose to stake.
Kraken Fees and Commissions
Kraken imposes various fees and charges across different aspects of its platform. Here is a brief summary of fees and commissions on Kraken:
- Trading fees: Each time you buy, sell, or convert assets on Kraken, you will be charged a fee. Kraken Pro features like margin and futures trading will attract separate fees, including margin fees, rollover fees, conversion fees, interest, and liquidation fees.
- NFT marketplace fees: NFT transactions on Kraken are subject to a 2% transaction fee. Additional fees apply for NFT token withdrawals, which vary by blockchain. Listing NFTs on the Kraken NFT marketplace is free.
- Staking commission: Kraken aims for a 15% commission based on the rewards earned from staking.
Deposits and Withdrawals on Kraken
Depositing Fiat Currencies on Kraken
Verified users can fund their Kraken account using multiple funding options, which include Visa and Mastercard debit and credit cards, Apple Pay, Google Pay, and online banking services. Note that Kraken applies fees when you use debit/credit cards, digital wallets, or online banking services to purchase cryptocurrencies. U.S. users cannot use credit cards to fund their Kraken account.
Cash Transaction Limits and Restrictions
There are specific cash transaction limits and restrictions when buying crypto on Kraken. The minimum USD transaction amount is usually fixed at $10 per transaction. A maximum spending limit of $10,000 for a seven-day rolling period is also placed. The cash transaction limits vary depending on your funding method, the fiat currency you are using, your residency region, and your verification level.
Depositing Cryptocurrencies on Kraken
You need to be verified as an intermediate or pro user to deposit crypto to your Kraken account. Depositing crypto on Kraken is straightforward. If you have sent crypto from one wallet to another, then it will be no problem for you. Note that if you are sending crypto to your Kraken account for the first time, you will need to generate a deposit address.
Withdrawing Cash From Kraken
Kraken supports cash withdrawals in seven fiat currencies: USD, EUR, CAD, AUD, GBP, CHF, and JPY.
After conducting a thorough Kraken review, we noticed that USD, JPY, AUD, CAD, and GBP withdrawals are processed through a third-party account with Etana Custody. For European currencies, EUR and CHF, Kraken uses SEPA transfers via Bank Frick, allowing direct entry of bank details without needing a third-party account.
The process of transferring cryptocurrency from your Kraken account to an external wallet is pretty standard. There is a 24-hour crypto withdrawal limit in place where intermediate users can withdraw crypto tokens up to $500,000 a day, while Pro users can withdraw up to $10 million.
Kraken Customer Service
Kraken provides a variety of customer support services. It has a 24/7 virtual chatbot for answering queries at any time. For users in the US, Canada, UK, and E.U., there is also phone support for more direct assistance.
It offers enhanced support for frequent traders, which includes a personal account representative for those who consistently trade on the platform.
For high-volume traders, Kraken has a VIP Portal, accessible based on historical trading volume. This service includes features like access to an account manager, advanced trading information, insights into institutional liquidity, and the ability to participate in VIP-specific surveys.
Is Kraken Safe?
Security Features
When evaluating the security of Kraken as a cryptocurrency exchange, several key features stand out:
- Proof of Reserves: Kraken follows the industry standard of conducting proof of reserve audits. These audits are performed periodically with the help of external auditors. They provide a snapshot of Kraken’s cryptocurrency balances across various categories, including spot, staking, margin, and futures trading.
- Custody Security: Kraken functions as an exchange and a custodian for its customers’ crypto assets. The company stores these assets in a combination of cold wallets (offline storage, which is more secure) and hot wallets (online storage, for more liquidity).
- Bug Bounty Program: Kraken runs a bug bounty program to encourage identifying and reporting system vulnerabilities. This program offers Bitcoin rewards for submissions, with a minimum payout equivalent to $500 in BTC and potential rewards of up to $1.5 million for critical severity issues. The highest bounty paid out by Kraken at the time of reporting was $60,100.
- Two-Factor Authentication (2FA): For additional account security, users can enable 2FA. This can be done through an authenticator app or a security key.
Licensing & Security
Understanding how compliant your crypto exchange is with industry regulations is important. With this in mind, here is a list of registrations, approvals, and licenses that Kraken holds:
U.S.
- Kraken is registered as a money services business with FinCEN.
- Kraken’s subsidiary, called Kraken Bank, is recognized under federal and state law to provide deposit-taking, custody, and fiduciary services for digital services.
Canada
Kraken is registered as a money services business with FINTRAC.
U.K.
- Kraken has registered with the FCA as a crypto asset firm.
- Kraken, through its subsidiaries, operates as a FCA-authorized investment firm.
Italy
Kraken is registered as a virtual asset service provider with the Organismo degli Agenti e dei Mediatori.
Australia
Kraken is registered as a digital currency exchange with AUSTRAC.
UAE
Kraken is allowed to provide digital asset custody services and is permitted to operate as a multilateral trading facility under a financial services permission granted by the FSRA.
Latest Industry Concerns – SEC vs. Kraken
On 20 November 2023, the United States Securities and Exchange Commission (SEC) initiated legal action against Kraken. The SEC’s lawsuit accuses Kraken of functioning as an unregistered securities exchange, broker, dealer, and clearing agency.
The SEC’s complaint centers around allegations that Kraken mixed customer funds with its operational accounts, using these commingled resources to cover operating expenses. According to the SEC, this practice exposes Kraken’s customers to various risks stemming from inadequate internal controls and subpar recordkeeping.
Responding to these allegations, Kraken stated on the same day:
“We disagree and intend to vigorously defend our position in court. Today’s news has no impact on the products we offer, and we will continue to provide services to our clients without interruption. We remain fully committed to our U.S. and global clients and partners.”
This lawsuit against Kraken is not an isolated incident. Earlier in the year, the SEC filed similar legal actions against other major cryptocurrency exchanges, including Coinbase and Binance. These developments reflect a broader regulatory scrutiny of the cryptocurrency industry, with significant implications for exchanges and their customers.
Kraken vs. Coinbase, Binance
Let’s take a look at the comparison of Kraken’s rating against the two largest crypto exchanges globally – Coinbase and Binance:
| Kraken | Coinbase | Binance | |
| Founded in | 2011 | 2012 | 2017 |
| Cryptocurrencies listed | Offers a wide variety of cryptocurrencies | Has a comparatively lower number of cryptos listed | Offers a wide variety of cryptocurrencies |
| Peer-to-peer trading | Not available | Not available | Available |
| Cash deposits and withdrawal | All three exchanges have limited options that vary with different regions. A lack of regulatory clarity is a major hindrance in this aspect | ||
| Staking | Staking services are available for certain tokens on all three platforms | ||
| NFT marketplace | Available | Available | Available |
| Associated blockchains | Does not have an associated blockchain | Developed Ethereum layer two, called Base | Associated with the BNB Chain (formerly Binance Smart Chain) |
| Proof-of-reserves | Conducts periodic proof of reserves audits by a third party | As a publicly listed company, it discloses financial statements quarterly and annually | Publishes proof of reserves using zk-SNARK technology |
Kraken Wallet vs Coinbase Wallet
Kraken and Coinbase both offer a self-custody wallet. This allows users to control their own assets and both can connect to their respective exchanges. These wallets function as a gateway into Web3 and allow holders to connect to dApps and access DeFi services. Learn more in our Kraken Wallet vs Coinbase Wallet Guide.
The Bottom Line: Is Kraken a Good Crypto Exchange?
Kraken has established itself as a household name in cryptocurrency, gaining a solid reputation over the years. The exchange is recognized for its user-friendly access, providing a comprehensive crypto experience tailored to retail customers.
For those prioritizing security, managing cryptocurrencies in a self-custodial wallet is recommended. This approach ensures that your digital assets remain securely under your control regardless of the crypto exchange used.
In this setup, Kraken can be effectively utilized as a fiat on-ramp and off-ramp.
FAQs
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References
- Top Cryptocurrency Spot Exchanges (CoinMarketCap)
- Verification level requirements (Kraken)
- New coin listing requests (Kraken)
- Kraken API, Trading Reliable and low latency trading backed by award-winning security (Kraken)
- Overview of On-chain staking on Kraken (Kraken)
- Kraken fee credits (KFEE) (Kraken)
- What are the fees (opening and rollover) for trading using margin? (Kraken)
- How do I deposit my local currency to Kraken? (Kraken)
- Cash deposit options (fees, minimums, and processing times) (Kraken)
- Deposit and withdrawal limits by verification level (Kraken)
- Bug Bounty, Get Bitcoin for finding security bugs (Kraken)
- Is Kraken licensed or regulated? (Kraken)
