In this kraken review we will go over the top services they provide as an exchange, talk about their pricing and fees, and see what exactly differentiates Kraken from the other crypto exchanges.
Kraken is one of the largest crypto exchanges on the market in terms of trading volume and liquidity.
Officially founded by Jesse Powell in 2011, Kraken was created as a response to the Mt. Gox security breach.
Based in San Francisco, California, the exchange officially joined the market in 2013, initially supporting Bitcoin, Litecoin, and euro tradings. Kraken is an unregulated exchange, which makes it very popular among people who believe in a decentralized cryptocurrency market.
They are also known as one of the most secure trading platforms. Since their release, there hasn’t been any security breach in their system.
Kraken Services Review
With a huge focus on security, Kraken helps its users trade on an advanced platform that provides trading options users with little to no experience in trading.
Their large trading volume creates high liquidity for the assets on the market, allowing users to quickly buy and sell assets at stable prices.
Kraken also provides margin trading and futures trading for more experienced users. This enables traders to maximize their gains based on market swings, using advanced trading strategies.
If you’re serious about investing, Kraken has an Over-The-Counter (OTC) trading platform and a dark pool, separate from the open one. Their OTC services are only available to individuals and businesses that look to trade upward of $100,000, and it aims at being “discreet, secure, and ultra-competitive”.
SIDENOTE. A crypto dark pool is a private trading platform that allows users to trade without making the transactions public. This allows major players (known as whales) to buy/sell large amounts of crypto without directly impacting the market and the price of the cryptocurrency.
For OTC trading, Kraken accepts the following fiat and crypto currencies:
- US Dollar (USD);
- Euro (EUR);
- Canadian Dollar (CAD);
- Japanese Yen (JPY);
- Bitcoin (XBT);
- Ethereum (ETH);
- Tether (USDT);
- Monero (XMR);
- Ethereum Classic (REP);
- And others…
It is important to note that their dark pool is only available to verified Pro accounts, with the minimum order sizes being 11.5 XBT (~$100,000) and 375 ETH (~$50,000).
When it comes to cryptocurrencies, Kraken accepts 31 crypto coins, some of which are:
- Bitcoin (XBT);
- Bitcoin Cash (BCH);
- Dash (DASH);
- Dogecoin (XDG);
- EOS (EOS);
- Ethereum (ETH);
- Ethereum Classic (ETC);
- Litecoin (LTC);
- Monero (XMR);
- Ripple (XRP);
- Stellar Lumens (XLM);
- Zcash (ZEC).
In terms of Ripple trading, Kraken has 4 fiat currency pairs and 1 cryptocurrency pair available:
- USD / Ripple;
- EUR / Ripple;
- CAD / Ripple;
- JPY / Ripple;
- BTC / Ripple.
Geographic Restrictions & Regulations
At the time of writing this article, Kraken is available on a global level, except in the following countries:
- North Korea;
Additionally, due to local restrictions and regulatory compliances, Kraken is not available in the following US States:
- New York.
Like all other major crypto exchanges, Kraken complies with both AML (Anti-Money Laundering) and KYC (Know Your Customer) regulations. This means that users who want to use their platform need to verify their account using personal information such as full name and address.
There are 5 tiers of users available on the platform, which are differentiated based on the various actions they perform. Each tier comes with various benefits.
Tier 0 is the starting level for every account that has been confirmed via email. A Tier 0 account can browse the platform but is not able to make deposits, withdrawals, or trade.
Tier 1 accounts are verified using the KYC and AML procedures by providing personal details such as full name, date of birth, country, and phone number. These accounts can trade cryptocurrencies but are not allowed to trade fiat or to make withdrawals and deposits.
Tier 2 is achieved by providing your full physical address, and enables users to deposit or withdraw up to 2,000 EUR/week or 10,000 EUR/month. Moreso, they allow the users to trade both fiat and crypto and withdraw up to $10,000/week and $50,000/month.
Tier 3 accounts require proof of identity and proof of address. They unlock deposits and withdrawals using Canadian Dollars (CAD), with the withdrawal limits being increased to $50,000/week and $200,000/month. Fiat transactions are also increased to $25,000/week and $200,000/month.
Tier 4 is the highest tier available on Kraken and requires in-depth identity verifications, but provides access to all the features of the platform. In order to get verified for a Tier 4 account you need to sign an application form and your KYC documents. The limits for both crypto and fiat transactions are greatly increased.
Kraken Pricing & Fees Review
Kraken charges a trading fee when an order is executed, with fees ranging from 0% to 0.26% of the total value of the order. This fee is impacted by several factors, such as:
- The traded currency pair;
- Your 30-day trading value in USD;
- Your role in the order (maker or taker).
For margin trading, Kraken applies two additional fees:
- Margin opening fee;
- Margin rollover fee.
In comparison to other exchanges, Kraken’s fees are generally lower, but not that different than other major players. However, Kraken is really competitive when it comes to high-volume trading.
Volumes upwards of $10,000,000 have 0.00% trading fees for makers and 0.10% for takers. On the other hand, traders with a 30-day volume between $0 and $50,000 are charged a 0.16% fee as a maker and 0.26% as a taker.
When it comes to stablecoins, Kraken’s fees are a bit different than for regular cryptocurrency. On a 30-day trading volume between $0 and $50,000, they charge a fee of 0.20% for both maker and taker. This fee then decreases, reaching 0% for both parties if they have a 30-day trading volume of more than $1,000,000.
Fiat currency transactions are also charged differently, based on Kraken’s payment partner.
- US wire transfer (USD) - flat rate of $5 for both deposits and withdrawals;
- SEPA bank transfer (EUR) - free deposits, 0.09 EUR for withdrawals;
- Canadian wire transfer (CAD) - free deposits, but the bank charges an additional fee. This usually revolves around $10;
- Electronic Funds Transfer (CAD) - 0.25% fee for withdrawals.
So how does Kraken fare up against other large crypto exchange platforms, such as Coinbase or Binance?
Kraken vs. Coinbase
While Kraken is a great trading platform, when it comes to the onboarding process for beginning traders, Coinbase is much more user-friendly. Kraken’s interface is simply too complicated for a beginner, and users can easily feel overwhelmed.
Coinbase also provides its users with the option to make transactions using debit cards and PayPal, in addition to Kraken’s bank transfers and crypto payments.
On the other hand, Kraken offers lower trading fees for its users, which gets significantly more important on large trading volumes.
When it comes to available cryptocurrencies, the difference isn’t that huge. Kraken has 31 cryptocurrencies listed, while Coinbase has 28.
Both platforms comply with AML and KYC procedures and place huge importance on security. Which is no surprise, considering the crypto market cap is more than $200bn.
So if you’re just getting started with crypto trading and you don’t plan to invest tons of money just yet, Coinbase might be the better choice. But if you’re serious about trading, Kraken is the choice to go.
Kraken vs. Binance
Another major player in the crypto exchange market is Binance.
When it comes to available cryptocurrencies, Binance is clearly the winner, supporting over 170 crypto coins (compared to Kraken’s 31). However, Binance does not support any fiat currencies. So if you’re planning to trade fiat for crypto, Kraken is the obvious choice on this one.
This also means that the only payment method available in Binance is via cryptocurrencies.
When it comes to trading fees, Binance also charges based on a 30-day trading volume, but they do so in BTC. Their fees range from 0.1000% for both maker and taker on a trading volume below 50 BTC and go as low as 0.0200% for the maker and 0.0400% for a taker on a trading volume of more than 150,000 BTC.
Reviewing Kraken's pricing fees in comparison with Binance can be a bit tricky, so I will spare you the math. Kraken is still in the win when it comes to trading fees since they can get as low as 0% for makers and 0.10% for takers (on the highest trading volume).
These being said, if you plan on trading cryptos only, Binance might be the better choice, simply because it has a larger pool of available cryptocurrencies. However, if you plan to use fiat-to-crypto trading or to trade larger sums, you’d be better off with Kraken.
Kraken is definitely a top crypto exchange, with their low trading fees making them super competitive on the market. And while their number available cryptocurrencies doesn’t compare to that of Binance, they support several fiat currencies. This makes it easy for anyone to get started with crypto trading.