Kraken is a San Francisco-based cryptocurrency exchange founded by CEO, Jesse Powell, in 2011. The exchange provides crypto to fiat trading to 176 countries and 48 US states via a web and mobile app. Coins available for trading include mainstays like BTC, LTC, and ETH; DeFi standards like YFI and BAL, as well as various cryptos that are not available on other US exchanges but are favorites in the global crypto community (i.e. Tether/USDT, Monero, Tron, and Waves).
*Note: Kraken and some other exchanges and platforms refer to Bitcoin as “XBT”, whereas other exchanges use “BTC” to denote Bitcoin. The XBT is akin to Gold’s trading term “XAU” with the X signifying that there’s no country denomination to it. Read more about the origins in our article, “XBT vs. BTC.”
Kraken’s array of core features enables traders of most experience levels to trade within a user-friendly, resource-rich environment. From a demo account that allows users to practice trading with no downside, to low fee trading across the board, the platform casts a wide net. It is functionally able to service target audiences across the globe with tiered levels of identity verifications.
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:
Additionally, Kraken’s homepage offers four distinct choices for getting started, depending on the experience level of each user:
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:
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.
Kraken is fully compliant with Anti Money Laundering (AML) and Know Your Customer (KYC) regulations, which is reflected in their verification procedures.
What are AML and KYC?
As part of a range of Anti Money Laundering regulations mandated nationally and internationally, KYC involves the requirement of companies to verify each customer’s identity during the onboarding process. Verification is achieved by submitted identification, proof of ownership, and personal information such as name, address, email address, phone number and tax I.D. number.
To maintain compliance with the AML/KYC requirements, Kraken offers different levels of verifications according to varying service offerings (i.e. withdrawal and deposit limits). New users determine what level of verification they will provide when setting up their account and can apply to change it at any time.
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:
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:
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:
The verification process takes about 5 days when first setting up an account; the higher the verification level, the longer it usually takes.
In addition to the core trading features provided by Kraken, multiple advanced options exist for professional traders:
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:
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:
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 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.
Kraken’s user interface is intuitive and easy enough to use no matter your level of trading experience. The colors could be contrasted a bit more for easier reading of their light purple font.
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.
Kraken offers three general options for views:
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.
To anyone first entering the realm of crypto trading, they often hear news stories about multimillion dollar exchange hacks, which become a valid concern due to their frequency. Kraken has a long standing reputation for never falling prey to an attack. CEO/Founder, Jesse Powell, has been stressing and working on exchange security since his early experience lending assistance to the Mt. Gox exchange in their recovery from a massive hack in 2011.
Powell’s early encounters with exchange vulnerabilities give many traders more confidence that Kraken will be a safe place to park crypto assets. But, as even the Kraken website consistently iterates, traders should adhere to standard risk management policies and generally keep as little as possible on any exchange and follow safe cold storage procedures.
All digital assets on the Kraken exchange are stored by regional subsidiaries of Kraken-owned Payward. Registered information is safely stored and transferred to company personnel over secure connections, according to the Kraken privacy statement.
Payward self certifies to the US Department of Commerce and adheres to all regulatory frameworks for the regions in which they operate. They are fully compliant with AML/KYC regulations, as well as the EU-US Privacy Shield Framework that governs the protection of personal information. Data on users must be kept for 5 years after the business relationship ends to be compliant.
Kraken is one of the few American exchanges that offers access to certain privacy coins, such as Monero. Privacy coins are cryptocurrencies that are heavily encrypted and default to “mixing” methods, which shield identities by combining transactions. Privacy coin protocols automatically obfuscate the sender and receiver identifying information so that it is close to impossible to detect who is sending and receiving the privacy coins.
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.
Kraken is one of the major crypto institutions enjoying a long standing reputation as an exchange that has never been hacked. Further, the exchange remains up and running when other exchanges go offline during times of heavy buying.
We found no glaring concerns and generally a self-regulated company that has improved its services and product offering over time while remaining cutting edge and secure (as secure as an unregulated crypto exchange can be). Kraken was the first crypto exchange to be listed on Bloomberg Terminal back in 2014 and continues to innovate today – they recently were awarded the world’s first crypto bank charter.
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.