Kraken

A thread that runs through the Kraken experience is educational resources. Upon each sign-in, users are greeted with a revolving set of reminders titled, “Protect Your Accounts”, which teach about:

• How to prevent unauthorized changes to your account
• Best ways to use 2FA (security token is the best option, according to Kraken)
• How to detect phishing attempts
• Reminders to keep strong, unique passwords for every application

Additionally, Kraken’s homepage offers four distinct choices for getting started, depending on the experience level of each user:

1. Beginner (New to crypto)
2. Intermediate (Taking digital investments to next level)
3. Advanced (Looking for additional exchange features) https://www.kraken.com/en-us/#route-advanced
4. Institutional (Companies with unique exchange needs)

Also available is a full set of crypto guides to help introduce traders to over 50 coins, as well as a podcast and a medium-quality video channel that features security topics such as how to avoid SIM swaps. 

Although users may find the instructional videos a bit on the dry side, Kraken does have a multi-faceted system of resources in place.

Kraken’s security guides at login offer an effective method of keeping traders up to speed on how they can trade cryptocurrencies securely.

Kraken has long been known to offer very competitive fee pricing, and that continues today. Their volume-based fees favor the trader who makes more trades within the given 30-day period, which also provides incentives for driving liquidity. 

Trading fees are the same across coins, which adds another level to the exchange’s liquidity performance. Here is the current fee structure for spot trading.

A stablecoin is a cryptocurrency that is pegged 1:1 to another asset. Kraken is one of the few American crypto exchanges that enables stablecoin trading with Tether (USDT), which is purportedly pegged 1:1 with USD cash reserves, although there is no evidence of an audit to verify said reserves. 

Other exchanges, like Coinbase and Gemini, opt to trade their own version of a stablecoin (USDC and GUSD, respectively), both of which are backed by USD.

Stablecoin trade fees on Kraken include all trades where the stablecoin is the base currency, i.e., USDT/USD or DAI/USDT. Maker and taker fees for stablecoins per 30-day trade volume range from .20% to .04%.

Otherwise the fees are the same for the other crypto spot trades.

Kraken enables users to fund their accounts in 3 basic ways:

1. Fiat deposits – Users must have intermediate or pro level verification; deposit limits are $100,000 for intermediate level and $500,000 for pro. Available fiat currencies are currently USD, EUR, CAD, GBP, CHF, JPY, and AUD. First time fiat deposits are subject to a 72-hour waiting period.
2. Cryptocurrency deposits – Deposit amounts for both the 24-hour and 30-day window are unlimited for all accepted cryptocurrencies and for all three verification levels. The crypto coins that are eligible for deposit are currently XBT, ETH, XRP, LTC, and XMR.
3. Credit & debit cards – Users that pass Intermediate and Pro Level verification and who reside in certain regions may use their debit or credit card to buy cryptocurrencies with EUR using Kraken’s Buy Crypto feature. (Users should be forewarned that fees and interest charged by credit card companies can sometimes exceed the cost of the crypto and is not a recommended method of buying digital assets.)

Crypto: Kraken allows users to withdraw cryptocurrencies to external (non-Kraken) wallets. The fees and minimum withdrawal amounts vary by coin. With Bitcoin, the withdrawal limit is 0.0005 XBT and the fee is 0.0005 XBT (currently ~$13.00). With most altcoins, the fees and minimum withdrawal amounts are much lower than with Bitcoin. For example, the minimum withdrawal amount for BAT tokens is 10 BAT and the fee is 4 BAT (currently less than $1.00).

Fiat: Minimum withdrawal amounts and transfer fees may vary by currency, verification level, and regional regulatory ecosystem. They range from direct domestic transfers to international wires. Most of the fiat withdrawal fees are between 0.125% and 0.25% with a minimum fee of about $35.00. Normal turnaround time for fiat withdrawal completion is at least 1-5 business days.

Generally speaking, for trading crypto on the platform and for smaller trading amounts, the starter verification level is sufficient. This level requires the following customer information:

• Name
• Birthdate
• Email address
• Phone number. 
• Date of birth

Once you begin larger transactions and/or when banks become involved (such as with bank transfers, wires, or purchasing crypto with a credit card), the user must submit additional verification documents. If Pro Verified, users have higher deposit and withdrawal limits. Documentation required for this level of verification includes:

• All from Starter verification
• Passport
• Tax I.D. number
• Occupation information
• Proof of residence
• Face photo

For users who want the highest deposit and withdrawal limits, and who want access to dark pool and Over the Counter (OTC) transactions, they will need everything from Starter and Intermediate verifications plus:

• KYC Questionnaire (which asks for detailed information regarding the business, its customers and procedures)

The verification process takes about 5 days when first setting up an account; the higher the verification level, the longer it usually takes.

Kraken offers margin trading on 16 cryptocurrencies, up to 5x with margin limits as high as $500,000 for eligible investors. Margin fees are .02% to open a position, and never more than 0.02% in rollover fees (per 4 hours).

Kraken’s futures market supports XBT, ETH, LTC, BCH, and XRP. Users can trade derivatives on these digital assets with up to 50x leverage. A 15-part Introduction to Futures is available for Kraken users and support tickets for futures trades are usually handled within a few hours, according to Kraken. 

The interface for futures is more sleek and techy than the main page and spot exchange layout, offering a nice dark mode with the same easy, intuitiveness. But the advanced layout hopefully signals to novice traders a contrast with spot trading.

Staking on Kraken involves two types of staking, on-chain and off-chain:

On-Chain Staking

This enables users to earn tokens for whichever coin they choose to stake (also referred to as “in-kind staking”). By staking, you are essentially holding crypto assets in a special wallet while they assets are pooled to lend out to others. For on-chain staking, users receive interest payouts in the form of whichever coin they are staking. At Kraken, stakers can buy and stake multiple cryptocurrency coins, including:

• Cosmos (ATOM)
• Ethereum (ETH)
• FLOW (FLOW)
• Kusama (KSM)
• Polkadot (DOT)
• Tezos (XTZ). 

Kraken also plans to add DASH in the future. Their most recent addition to on-chain staking was Ethereum staking. With the Ethereum 2.0 Network in the process of migrating from Proof of Work to Proof of Stake, the second largest crypto by market cap can now also be staked to receive rewards. 

Stakers at Kraken receive payouts twice a week automatically according to the rewards per year (RPY) rate of return. The RPY varies depending on the coin. In general, the least liquid cryptocurrencies (fewer markets and fewer transactions) have the highest RPYs. Users are able to stake and unstake any amount, any time. They’re also able to withdraw staked balances to external crypto wallets.

Off-Chain Staking 

Off-chain staking at Kraken rewards users for holding Bitcoin (XBT), Euro (EUR), or the US Dollar (USD) but is not available to most western countries (i.e. restricted nations include the US, Canada, UK, France, Australia, Germany, Hong Kong, Japan, etc.),

The payout structure is the same as with on-chain staking – twice weekly with in-kind rewards. One thing that differs is that off-chain staked assets cannot be withdrawn to an external wallet.

Kraken’s off-chain staking program will impact a user’s equity for margin training since staked assets are collateral currencies and while staked are removed from trading balances. 

Complete details for Kraken’s off-chain staking program are found in their Terms of Service.

Over the counter (OTC) transactions are available for high volume trades, offering a private and more personalized experience for high net worth individuals and financial institutions. Large orders can be filled without causing too much disruption to spot prices. 

A full account management program is an additional service for advanced traders and boasts near real-time, “hyper-personalized” support.

Navigating the Kraken site is probably the most optimized experience you’re going to run into (currently) in the crypto exchange space. It’s fast, responsive, super easy to understand what’s happening at each step, with helpful, relevant resources at every level.

Kraken, and almost every other cryptocurrency exchange, have had ongoing issues with customer support complaints. As global entities with millions of users, the barriers to create support levels that match user activity are slowly being removed as exchanges like Kraken innovate and continue to add support services. 

Currently, Kraken offers 24-hour chat service, which when tested by one of our researchers, responded with helpful answers immediately. Problematic or lagging support tickets were once a widely known issue, with complaints freely flowing on TrustPilot and Reddit. But Kraken has improvised their and they’ve integrated some innovative ways for users to get better support, including a dedicated Kraken Support subreddit which provides streamlined access to support personnel. 

The Kraken app averaged 4.7 stars for over 1700+ reviews in the App Store, and 4.5 stars for 6000+ reviews in Google Play.

Kraken offers three general options for views:

1. Market Cap View – view standard listings with market caps
2. Classic Charts View – View spread, recent trades, depth charts and order book
3. Advanced Markets View – View detailed candlestick charts and use multiple, advanced charting and drawing tools

The advanced charts interface is super sleek and attractive, offering 13 time ranges (from 1m to 1w), easy extropalator tool for extending individual lines, a nice share feature with a link, and many customizations including 17 different themes and 15 languages. The charts that you create in Kraken will be available to you when you log back in another day, as long as you haven’t cleared your cache and cookies.

Kraken’s high level of reliability stands out against Coinbase, an exchange that, almost like clockwork, has outages during rapidly moving bull markets. According to Kraken’s Status page, downtime and outages are rare.

Kraken prides itself on its “radical” transparency within the greater crypto and regulatory communities. They initiated and carried out the world’s first, cryptographic Proof of Reserves audit.

No hacks have been reported for Kraken. The exchange keeps as much crypto offline in cold storage as possible to help minimize hacking opportunities.

The Kraken Exchange provides a full service experience for crypto traders. There are only a few things missing, most of which can be alleviated with bots.

• Dollar cost averaging is not available on Kraken, however, several scripted tools have been devised by external parties to automate daily and weekly buys.
• Self custody of digital assets (i.e. ownership of private keys) is not available. But Kraken does have the reputation as one of the most (if not “the” most) secure crypto exchanges. 
• Automated trading, again, is not integrated into Krakens service offering but they are associated with multiple trading bot partners.
• Automated tax reporting is not available on Kraken, but detailed transaction reports are. Other than that, it is up to the user to report any capital gains or losses, etc.
• Personal wallet services are not available through Kraken. While they will hold your crypto assets for you in their corporate wallet (most of which is cold storage, meaning stored offline), they recommend storing them outside the exchange whenever possible.