Kraken Review

Kraken is a cryptocurrency exchange with a reputation for low fees and high security. How do they compare to their competitors? Read on to find out.

Really low fees, 160+ cryptocurrencies, and industry-leading security features.

In a crowded field of crypto exchanges, Kraken stands out.

But how does it stand up to other exchanges? Read our full review to find out if Kraken is right for you.

What is Kraken?

Kraken is a cryptocurrency exchange founded in 2011 as a quick and easy way to trade Bitcoin. Since then, they've grown to offer over 150 cryptocurrencies, as well as trade several fiat currencies.

They are based in San Francisco, and currently have over 1,300 employees. Currently, they operate all across the U.S. (with the exception of New York and Washington state), and worldwide.

Kraken was the first Bitcoin exchange to pass a cryptographically verifiable proof-of-reserves audit, and the first to have its market data displayed on the Bloomberg Terminal. They claim to be the largest Bitcoin exchange by euro volume and liquidity. As of writing, they have never been hacked.

Whether you're a new retail investor or executing trades for hundreds of thousands of dollars, Kraken may be worth considering.

How Does Kraken Work?

Kraken allows users worldwide to buy and sell cryptocurrencies (plus a number of fiat currencies).

You can buy and sell assets on Kraken's mobile app (Apple, Google Play) and desktop site.

They earn their money by taking a percentage in fees from every trade made on their platform, but offer competitively low fees even to low-volume users who sign up for Kraken Pro.

Kraken currently offers over 160 cryptocurrencies, including:

• Aave, Aragon, Augur, Augur v2, Balancer, Basic Attention Token, Bitcoin, Bitcoin Cash, Chainlink, Compound, Cosmos, Curve, DAI, Dogecoin, EOS, Energy Web Token, Enzyme Finance, Ethereum, Ethereum 2, Ethereum Classic, Filecoin, Flow, Gnosis, ICON, Kava, Keep Network, Kusama, Kyber Network, Lisk, Litecoin, Monero, Nano, OMG Network, Ocean Protocol, Orchid, PAX Gold, Polkadot, Qtum, Ripple, Siacoin, Stellar, Storj, Synthetix Network Token, tBTC, Tether, Tezos, The Graph, Tron, USD Coin, Uniswap, Waves, yearn.finance, Zcash

• Users can also trade Euros, USD, and AUD for other fiat currencies on the platform.

• Kraken does not work in the following countries: Afghanistan, Cuba, Guinea-Bissau, Iran, Iraq, Japan, North Korea, Tajikistan.

There are 3 levels of verification on Kraken, with different abilities:

• Starter: You can deposit, exchange, and withdraw crypto, but you can't withdraw or deposit fiat currency.
  
• Intermediate: You can now deposit fiat currency and trade on Kraken Futures. Requires a photo ID (passport or driver's license), a proof of residence (utility bill), and your Social Security number or ITIN.
  
• Pro: You can access the dark pool and OTC trading desk; for making high volume orders without causing price fluctuations on the exchange.

Pros and cons

Pros

• Low fees compared to other exchanges
  
• Maximum liquidity for crypto
  
• Strong security focus
  
• Wide variety of trading options
  
• Bonuses for high-volume traders
  
• Available worldwide
  
• Upgraded support and features for advanced traders

Cons

• Interface may confuse new traders
  
• Slow account funding with limited options for fiat currency
  
• Support may be slow to respond
  
• Email or phone support not available to all users

Features

Below, a few of Kraken's top features that make them stand out from the crowd.

• Margin Trading: Kraken was one of the first exchanges to offer leveraged bitcoin margin trading. Traders can leverage cryptocurrencies up to 50x. This feature is not for beginners and should be considered very high risk.

• Over the Counter: For trades over $100k, Kraken offers 1-on-1 service, especially for traders who trade infrequently but at high dollar amounts, and a dedicated account manager for frequent high-volume traders.

• Dark Pool: Kraken offers a dark pool for traders looking to place very large buy or sell orders, which may cause the market to move unfavorably when seen by other traders.

  By allowing traders to place their orders anonymously and invisibly to the rest of the market, they are more likely to be able to fulfill those orders at a desired price. This feature is only available for Bitcoins being traded with EUR, USD, JPY, or GBP.

Fees to Look Out for

Kraken claims to offer fees as low as 0%, but zero percent fees are only available to extremely high-volume traders over $10m per 30 days.

They have different fee schedules for different trading methods and volumes.

Kraken offers two main options for buying and selling: Instant Buy and Kraken Pro. Their fees are calculated per trade. Some values are expressed in euros.

Instant Buy: Simple easy trading via Kraken.com or the Kraken app.

Note that Instant Buy purchases are not counted toward the Kraken Pro 30-day volume.

• Crypto purchase with account balance: 1.5%
  
• Stablecoin & FX purchase with account balance: 0.9%
  
• Payment card processing fee: 3.75% + €0.25
  
• Online banking processing fee: 0.5% + $0.10 (this feature is currently limited, but planned for all U.S. residents)

Kraken Pro: Volume incentives based on activity in the past 30 days, using a maker-taker fee schedule

Although Pro requires up to 5 days to verify new users (compared to 1 hour for Instant Buy), the dramatically lower fees of Pro make it the obvious choice.

• $0 - $50k
  
  • Maker: 0.16%
    
  • Taker: 0.26%
  
  
• $50k - $100k
  
  • Maker: 0.14%
    
  • Taker: 0.24%
  
  
• $100,001 - $250k
  
  • Maker: 0.12%
    
  • Taker: 0.22%
  
  
• $250,001 - $500k
  
  • Maker: 0.10%
    
  • Taker: 0.20%
  
  
• $500,001 - $1m
  
  • Maker: 0.08%
    
  • Taker: 0.18%
  
  
• $1,000,001 - $2.5m
  
  • Maker: 0.06%
    
  • Taker: 0.16%
  
  
• $2,500,001 - $5m
  
  • Maker: 0.04%
    
  • Taker: 0.14%
  
  
• $5,000,001 - $10m
  
  • Maker: 0.02%
    
  • Taker: 0.12%
  
  
• $10m+
  
  • Maker: 0%
    
  • Taker: 10%

Deposits and Withdrawals
The majority of deposits are free on Kraken, except for certain newer or less common cryptocurrencies such as Augur, Chainlink, and Gnosis, which may incur small deposit or wallet setup fees.

Withdrawals on Kraken always incur a small fee, and also have minimums, both of which vary depending on the currency:

• Bitcoin: 0.0005 BTC
  
• Ethereum: 0.004 ETH
  
• Litecoin: 0.001 LTC
  
• Monero: 0.0001 XMR
  
• Dash: 0.005 DASH
  
• Ripple: 0.02 XRP

How to Get Started with Kraken

Getting started with Kraken takes a few extra steps to ensure your account is secure. Here's what you can expect:

1. Visit the Kraken website and "Create Account". You'll be asked for personal info like name, residence, and contact data.

2. Once you've created your account, you will generate a one-time API key. Kraken walks you through it during the setup process.

3. Once you've put in your API key, you'll have full access to your account.

4. After that, you'll verify your account on their desktop site. Click "Verify" on the account type you want to open.

   For the Intermediate account, you need a photo ID like a state ID, driver's license, or passport.

5. Once you've been verified, you will set up two-factor authentication using your mobile device or a Yubikey.

6. Then, you can fund your account and start trading.

Security Measures and User Privacy

Kraken offers an impressive list of security and privacy features. They hold 95% of their cryptocurrency offline in air-gapped, geographically distributed cold storage.

Servers are kept in locked cages with armed security and 24/7 surveillance. Sensitive information is always encrypted. Kraken also has both an internal team searching for security flaws as well as a bug bounty offered to independent security specialists who identify weaknesses in their defenses.

They offer:

• Two-factor authentication - Google Authenticator & Yubikey
  
• No phone/SMS account recovery
  
• Email confirmations for withdrawals + self-serve account lock
  
• Configurable account timeout
  
• Customizable, granular API key permissions with range boundaries
  
• Global settings time lock
  
• PGP signed and encrypted email
  
• SSL encryption
  
• Real-time monitoring for suspicious activity
  
• Sensitive data is fully encrypted at rest and in transit

Common Complaints

Legitimate customer reviews about Kraken online were overall positive. While there were a large number of negative reviews left on popular reviewing sites, these were largely transparent attacks by bots and scammers.

Can you get scammed on Kraken?
As with any crypto exchange, it is absolutely possible to get scammed on Kraken. However, the scamming rarely happens on the exchange itself.

Instead, be wary online of phishing attempts or false URLs that may lure you into unwittingly sharing your personal information or passwords.

Anyone purporting to be an investment guru or "recovery specialist" should be viewed with skepticism. Employ security features like 2FA, keep your crypto in a cold wallet, and never click unfamiliar links in emails to stay safe.

Can Kraken steal my money?
As a regulated exchange that complies with financial regulations in the states where it operates, the chances that Kraken will steal your money are slim.

If you feel your assets have been misappropriated, consult their Support resources. If you fail to reach a resolution there, consider posting a query on a public forum like Reddit, where Kraken representatives are known to respond.

Contact Customer Service

Kraken has a 24/7 active support desk, accessible via chat or support ticket.

Just visit their desktop support page, and you can submit a ticket by clicking "Submit Request" or start a chat to solve your problem.

You can also find the "Submit Request" button in their mobile app, under the profile heading.

Kraken Alternatives

Kraken is only one of several cryptocurrency exchanges. Let's see how it compares to some popular competitors.

Kraken vs Coinbase:

Coinbase is one of the most well-known cryptocurrency exchanges out there, and the reason for that is that it's very accessible.

But while Kraken has a bit more of a learning curve, it scores better in a number of important metrics. The number of cryptocurrencies supported on Kraken is quite a bit higher, giving you more trading options.

Kraken scores slightly better on security. Kraken beats out Coinbase and Coinbase Pro when it comes to lower fees.

Newer users may prefer Coinbase, but Kraken is overall probably the better platform.

Kraken vs Binance:

Binance has some of the lowest fees in the industry, making it an obvious choice for traders looking to save as much as possible on their trades.

In other respects, Kraken and Binance are quite similar. The only place where Kraken may have a leg up on Binance is security, as Kraken employs a wide range of security features to keep your crypto safe.

Binance is by no means unsafe, but may take fewer precautions than Kraken.

If your focus is security, you may find some benefit in choosing Kraken over Binance. In terms of pure value, Binance is the superior choice.

Bottom Line: Should You Use Kraken?

There's a reason that Kraken is considered one of the top cryptocurrency exchanges on the market. They offer quality service, with a highly polished mobile site and desktop app.

They have a 24/7 support desk, and take great measures to maintain the security of your assets. It isn't the easiest exchange to use, or the cheapest, but considered overall, it should be a strong contender for your choice of exchanges.