Kraken is one of the oldest surviving cryptocurrency exchanges, founded in 2011 by Jesse Powell in the aftermath of the Mt. Gox hack, which Powell personally witnessed. Based in San Francisco, Kraken serves millions of customers across 190+ countries and offers spot trading, margin trading (up to 5x), futures, and staking services. It is widely considered one of the most security-conscious exchanges in the industry — it has never suffered a significant hack. Kraken is also notable for obtaining a Wyoming Special Purpose Depository Institution (SPDI) charter (Krakenbank) in 2022, becoming one of the first crypto companies with a US banking license.
How It Works
Account Types
- Starter (non-verified): Limited to crypto deposits, no fiat
- Intermediate: ID verification required; enables fiat purchase/withdrawal
- Pro: Enhanced limits for institutional-grade trading
Trading Products
- Spot: Buy/sell 200+ cryptocurrencies with USD, EUR, GBP, CAD, AUD, CHF, JPY pairs
- Kraken Pro: Advanced charting, order types (limit, stop-loss, take-profit, trailing stop), lower fees
- Margin Trading: Up to 5x leverage on selected pairs
- Kraken Futures: Cash-settled perpetual and dated futures (via Kraken Futures, UK-regulated)
- Staking: Earn yield on ETH, DOT, ADA, SOL, and more (availability varies by jurisdiction)
- NFT Marketplace: Launched in 2022; supports Solana and Ethereum NFTs
Fee Structure
Spot fees: Maker 0.16% / Taker 0.26% (decreasing with volume, down to 0.00%/0.10% for highest tier). Staking fees: Kraken takes 15% of staking rewards.
Security
- Founded specifically to be more secure than Mt. Gox
- 95%+ of assets held in air-gapped cold storage
- Proof of Reserves published regularly (audited)
- Never suffered a significant user fund hack in 14+ years of operation
- Regular third-party security audits
- Bug bounty program
History
| Year | Event |
|---|---|
| 2011 | Jesse Powell founds Kraken after witnessing Mt. Gox dysfunction |
| 2013 | First Bitcoin exchange to display trading data on Bloomberg |
| 2015 | Acquires Coinsetter and Cavirtex, expanding US/Canada reach |
| 2016 | Bitfinex hack: Kraken assists with creditor distribution |
| 2019 | Launches Kraken Futures (UK-regulated) |
| 2021 | Valued at $10B; declines IPO in favor of direct listing or token |
| 2022 | Krakenbank: Wyoming SPDI charter approved (Kraken Financial) |
| Feb 2023 | SEC sues Kraken over unregistered securities (staking-as-a-service); Kraken settles, shutting US staking program and paying $30M |
| Nov 2023 | SEC files expanded lawsuit against Kraken for operating as unregistered exchange/broker-dealer |
| Nov 2023 | Jesse Powell steps down as CEO; Dave Ripley becomes CEO |
| 2024 | NinjaTrader (futures platform) acquisition announced |
Common Misconceptions
“Kraken was shut down by the SEC.” Kraken settled the staking enforcement (shutting its US staking service), but the exchange continues operating. The broader SEC broker-dealer lawsuit is ongoing.
“Kraken is only for advanced traders.” Kraken has simplified its interface for beginners. Kraken Pro is the advanced interface; the main site is more accessible.
Criticisms
- The SEC lawsuit settlement regarding staking (without admitting wrongdoing) set a controversial precedent
- Customer support response times have historically been slow during high-volume periods
- The staking shutdown for US customers removed a significant yield-earning feature
- Jesse Powell’s outspoken social media presence created PR issues
Social Media Sentiment
Kraken maintains generally positive sentiment among experienced crypto traders who trust its security track record. The SEC staking settlement created significant backlash in the US community. Kraken is frequently compared favorably to Binance on security and compliance. Jesse Powell’s personal takes on politics and culture (separate from Kraken) divided opinion.
Last updated: 2026-04
Related Terms
- CEX
- Staking
- Margin Trading
- Proof of Reserves
- Coinbase
- Binance, Staking, Margin Trading, Proof Of Reserves, Coinbase, Binance
Sources
Moore, T., & Christin, N. (2013). Beware the Middleman: Empirical Analysis of Bitcoin-Exchange Risk. Financial Cryptography Conference.
Gandal, N., et al. (2018). Price Manipulation in the Bitcoin Ecosystem. Journal of Monetary Economics.
SEC v. Payward Inc. (Kraken). (2023). SEC Settlement Order — Staking-as-a-Service Program. SEC Enforcement Actions.
Proof of Reserves. (2022). Kraken Proof of Reserves Audit. Armanino LLP.