Table of Contents
Introduction
We already looked at Kraken in our review of the best places to buy bitcoin online. We’ll go into more detail here and look at some of the other services Kraken offer.
The exchange was founded in San Francisco, California in 2011. Jesse Powell is the company founder and current CEO and is well regarded in the crypto community. The company is known for its high level of security and offers an exchange and trading platform to buy and sell bitcoin and many other cryptocurrencies.
Overview of Kraken
Kraken is a cryptocurrency exchange with beginner and advanced features to suit every type of trader. Up until recently it was a web only offering, but they have recently released a Kraken pro mobile app..
Kraken Services
Let’s have a look at some of the services that Kraken offer.
1 - Kraken Exchange
Kraken’s primary offering is a cryptocurrency exchange where you have access to many different trading pairs. For example, BTCEUR is the pair for trading Euro and Bitcoin. The trading interface includes four order options: Simple, Intermediate, Advanced and Pro. Depending on your trading experience and parameters needed you can chose the interface you want. They have a 4 tiered verification system and trading limits depend on your tier of verification, but as soon as you get verified you can begin trading.
Pros and cons of kraken Exchange
Pros
- Kraken is regulated and licensed
- Best practice security procedures, including the use of cold storage of exchange funds, separate internal and client networks and 2FA enforced for all customer accounts
- Available in almost every country
- Company has been around since the early days and has a good reputation
- Fees are volume-based which means the more you trade, the lower your rate. Maker fee starts at 0.16% with taker fee of 0.26%
Cons
- Not as beginner friendly as some exchanges
- Less trading pairs than some competitors
2 - Kraken Pro
Kraken Pro is the professional trading interface for advanced traders looking for technical analysis features such as charts and indicators.
It’s easy to customize and includes many different chart styles, overlays, indicators, and drawing tools that are used by traders. We have an introduction to some common trading chart patterns and indicators here.
3 - Kraken Margin Trading
Kraken supports trading on margin. You can use leverage to go long or short on a variety of cryptocurrencies by up to 5x. Leverage allows a trader to open a position that is larger than the balance of their account by borrowing the funds from Kraken. Essentially this means you can magnify gains, but also amplify your losses. Professional trader’s now have up to 50x leverage available, which means you can open a €100,000 position with as little as €2,000.
We recommend you read our introduction to margin trading on kraken to find out more.
4 - Kraken Futures
Kraken Futures are available since February 2019. Futures, or futures contracts, are an agreement to buy or sell an asset at a later date for a fixed price. Trading futures is attractive for a number of reasons compared to trading the underlying asset directly. They provide financial leverage, are used to hedge price risk and have lower transaction fees. Futures also help “smoothen” exposure for mining and Bitcoin ATM operators.
Some exchanges do not allow you to do so using cryptocurrency as the margin collateral. For example, the CME’s cash-settled futures contracts are settled in USD and the trader does not need to buy the underlying crypto asset.
Kraken on the other hand has cryptocurrency cash-settled futures contracts which means traders must have exposure to the asset itself for cash settlement.
Kraken currently list the following futures:
- Bitcoin price (USD)
- Ether price (USD)
- Litecoin price (USD)
- Ripple price (USD)
- Bitcoin Cash price (USD)
- Futures on the bitcoin price of Ripple XRP.
5 - Over-the-counter (OTC) trading
Institutional and high net worth individuals use OTC for high value transactions. OTC offers high liquidity offered when compared to exchanges and has fixed price to avoid slippage. Furthermore, OTC trades are also private and confidential which is beneficial for some traders who want to avoid order book visibility like you have with an exchange.
Kraken OTC accounts have the following requirements:
- Pro ( Tier 4) verified Kraken Account.
- Kraken always second settle.
- Bank wires must always match the Kraken Account name.
- USD 100k minimum trades.
Kraken are a preferred partner for Boinnex OTC.
6 - Dark pool
Kraken offer dark pool trading that allows traders to anonymously place large buy or sell orders which are hidden from the order book. This reduces the market impact of large trades and helps the trader avoid price slippage.
Note: Dark pool orders can only be matched with other dark pool orders and only limit orders are allowed.
Payment Methods
Deposits and withdrawals can be made via SEPA, SWIFT, wire and domestic transfers. In our experience SEPA deposits can be very fast and complete within 1 business day normally. A unique deposit reference needs to be included on fiat deposits which allows for automatic processing. Kraken do not currently support card payments.
Fiat and Cryptocurrencies Supported
Kraken accepts Euros, US dollars, Canadian dollars, Japanese Yen and UK sterling.
The following cryptocurrencies are currently available on Kraken:
Name | Code |
Augur | REP |
Basic Attention Token | BAT |
Bitcoin | XBT |
Bitcoin Cash | BCH |
Cardano | ADA |
Chainlink | LINK |
Cosmos | ATOM |
Dai | DAI |
Dash | DASH |
Dogecoin | XDG |
EOS | EOS |
Ethereum (“Ether”) | ETH |
Ethereum Classic | ETC |
Gnosis | GNO |
ICON | ICX |
Lisk | LSK |
Litecoin | LTC |
Monero | XMR |
Nano | NANO |
OmiseGO | OMG |
PAX Gold | PAXG |
Qtum | QTUM |
Ripple | XRP |
Siacoin | SC |
Stellar Lumens | XLM |
Tether (Omni Layer) | USDT |
Tezos | XTZ |
waterMelon | MLN |
WAVES | WAVES |
Zcash | ZEC |
Kraken Fees
Trade fees are very competitive when compared to competition such as coinbase pro, which currently has a 0.5% fee for low volumes.
Kraken uses a maker-taker fee schedule and has volume incentives based on your activity in the past 30 days. For example, for a volume of $0 – $50,000 the maker fee 0.16% is and the taker fee is 0.26%. The dark pool has a maker/taker fee of 0.36% based on the same volume.
With regard to fiat deposits, SEPA deposits are free, which is convenient for European customers.
Fore more on fees see the Kraken fee schedule.
Kraken customer support
Kraken support has improved tremendously over the last few years in our opinion. There is a lot of information now on their website support page and they also have 24/7 chat support which is very helpful. They also have a relatively quick turnaround time on support tickets, but do not yet offer phone support.
Kraken security
As mentioned, Kraken is renowned for their focus on the best security practices. They have a world class team of security experts headed by Chief Security Officer, Nick Percoco. You can check out Nick on the whatbitcoindid podcast earlier this year.
According to their website, “95% of all deposits are kept in offline, air-gapped, geographically distributed cold storage”. Kraken also have an expert team dedicated to testing. They have recently rolled out compulsory two-factor authentication and have a whole host of other security features to keep your funds secure.
Conclusion
Security above everything is an approach we endorse. Kraken has a growing portfolio of crypto services to cater for beginners and advanced users alike. In the early days, support was quite slow, but the support now is much better. Despite a lot of very negative reviews online, we haven’t had any problems to date with using Kraken and rate them very highly.
We’d love to hear about your experience in the comment section
