Kraken Review (2022): Flawless Security and Easy to Use

Kraken Overview

Introduction

Founded in 2011 and headquartered in San Francisco, Kraken is one of the oldest crypto exchanges, with more than 9 million individual and institutional investors in more than 190 countries worldwide. It is a well-regulated exchange available in most of the U.S., excluding New York and Washington state.

Kraken has two core products, Kraken and Kraken Pro, each with different features and target markets. Its primary product, Kraken, has been developed for beginners or those new to crypto and offers a clean and basic platform that makes buying, storing, and selling crypto simple. Kraken also has a comprehensive list of educational resources, making it an excellent starting point for any beginner.

Kraken Pro offers more advanced trading features with a slightly more advanced interface. This interface might be intimidating to new traders, but experienced crypto traders will find it intuitive and straightforward. Advanced features include margin and leverage trading, futures, and OTC trading, and offer traders the opportunity to grow their crypto with its staking services.

Is Kraken Safe?

Unlike its competitors (including Binance), Kraken has never experienced a major hacking event during its 10-year history.

Kraken’s commitment to security—and its proven track record of securing its customers’ funds—make it one of the best options when it comes to ensuring the safety of your cryptocurrencies.

Kraken stores 95% of deposits offline in geographically distributed cold storage. It also keeps reserves—that means if one of these storage units is compromised, you’ll still be able to withdraw your funds immediately.

Kraken uses encryption and tests its systems against all kinds of attacks. They even host a competition for the broader security community to find bugs in their systems.

Kraken’s other notable security features include:

• Two-factor authentication (2FA)
• Configurable account timeout
• Customizable, granular API key permissions with range boundaries
• PGP signed and encrypted email for secure communication
• Email confirmations for withdrawals with self-serve account lock
• 24/7 live chat and email support for urgent concerns

Kraken provides its users with an extensive security knowledge base that users can consult in order to make sure their funds are 100% secure.

Among other things, Kraken shows its users how to secure their account, set up two-factor authentication, set up a master key, set up a PGP encryption, set up a global setting lock, and create a strong username and password.

We liked that Kraken is taking the extra step and is willing to teach its users and hold their hand as they learn to protect themselves online. It is a great sign of a beginner-friendly exchange.

Getting Started

Which cryptocurrencies can you buy on Kraken?

Kraken is a spot exchange that supports 110 cryptocurrencies, including the most well-known ones like Bitcoin, Ethereum, Cardano, and Ripple. We won’t list every single crypto available here, but it has a little bit of everything – payment currencies (BTC, XRP), stablecoins (USDT, DAI), financial cryptos (REP, COMP), and utility cryptos (LINK, FIL). So while it only has 110 cryptocurrencies, if you want to build a balanced portfolio, you can.

Kraken also lets you know when it adds new listings, so you won’t miss out on investing in any new cryptos.

Sign-up & Verification Process

Kraken offers its users a simple, quick sign-up and verification process.
Once you’ve created your account with a username and password, you’ll want to secure your account. This means setting up both two-factor authentication and a master key.

Your master key is a backup for your two-factor authentication.

Next, you’ll need to get verified.

There are three account options you can choose from when you’re verifying your Kraken account:

1. Express
2. Intermediate
3. Pro

Express is the most basic account, which means it requires the least amount of verification. You’ll only need to provide some basic personal info.

Intermediate allows you to stake and trade futures, which makes it a better option for experienced traders.

Pro offers largely the same features as Intermediate, but you’ll also be able to trade crypto “over-the-counter.”

You’ll need to provide detailed financial information to get verified as a Kraken Pro member. Additionally, getting verified as a Kraken Pro user might take a few days, depending on when you submit all your financial paperwork and information.

Once you’ve verified your account, you can deposit funds—then you’re ready to go!

We created a Kraken Intermediate account, and from start to finish the process was seamless. The verification process for Kraken Intermediate takes approximately 4-5 minutes (as advertised), assuming all the documents you upload meet Kraken’s criteria.

In order to get verified for a Kraken Intermediate Account, you’ll need to upload documents that prove your identity—that means a valid SSN, face photo (if you live in South Africa or the United States), and a valid government-issued ID document.

You’ll upload all these documents to Kraken’s website, and wait for them to review their legitimacy.

All in all, the process took only a few minutes and wasn’t as annoying as these verification processes can be.

Funding Methods

Kraken’s “Buy Crypto” option allows you to purchase crypto directly using your debit or credit card if you’re located outside the US.

If you’re located within the US, you can also purchase crypto directly via ACH (excluding NY, TX, and WSH).

For cash and bank wire deposits, Kraken supports a range of currencies including USD, EUR, CAD, JPY, and more. If you live within the US (excluding NY, TX, and WSH), you’ll be able to use these deposit options with any type of account. If you live outside the US, you’ll need either a Kraken Intermediate or a Pro account to access these funding options. We found Kraken’s deposit option standard in a positive way.

Funding your Kraken account with cryptocurrency from an outside wallet is also an easy process. Simply send your crypto from your old wallet address to your new (Kraken) wallet.

We sent ETH from an ETH wallet to Kraken and then exchanged that ETH for DOT. The ETH arrived from the old wallet in a few minutes and was ready for trading immediately.

Withdrawals

Withdrawing cash from your Kraken account is simple.

You’ll need to add a bank account where you’d like to deposit your funds, and then you can request a withdrawal. Being able to withdraw fiat directly to your bank account is a big advantage if you are new to cryptocurrencies.

Cryptocurrency withdrawals require a little more effort, but they’re still relatively straightforward. First, you’ll need to search for the crypto you’d like to withdraw. Then you’ll need to add the address where you’d like to send the crypto and enter the amount you’d like to withdraw. You’ll then confirm your withdrawal. You may have to enter a code if you have a two-factor authentication setup.

We withdrew part of our crypto funds from Kraken and had no problems whatsoever in accessing our funds or transferring them between wallets.

Fees

Kraken has different fees associated with its products. Its primary product is purely for buying cryptocurrency, so it will have fees associated with crypto purchases and other fees like debit/credit card fees, which are often out of Kraken’s control. Kraken Pro is purely for trading crypto, so its fees will mainly be trading fees.

Kraken Crypto Purchase Fees

Kraken charges a flat fee for purchasing crypto. The fee will be 1.5% per transaction when using the Instant Buy feature. If you purchase stablecoins with another stable coin (USDT, USDC, or DAI), or USD, Kraken charges 0.9% per transaction.

You will also incur fees for debit/credit card purchases of 3.75% + 0.25c; this will be on top of the 1.5% or 0.9% fee for buying crypto. That’s a considerable amount of your crypto purchase that you aren’t seeing.

You can deposit fiat directly from your bank account if you want to save on credit/debit card fees. This is usually free, depending on your location and the bank you are with. But each deposit comes with a minimum amount and can be instant or take up to 5 business days. More details about the deposit methods from your location can be found here.

Kraken Pro Trading fees

Kraken’s advanced products and features charge relatively low fees, making them more attractive to experienced investors and traders. Kraken Pro uses a maker/taker fee structure for trading crypto, and fees are capped at 0.16%/026%. Fees depend on your 30-day trading volume, the currency pair being traded, and whether you are the maker or the taker. A more detailed breakdown of these fees can be found below:

Compared to some of its main competitors, like Coinbase, Kraken comes in considerably cheaper. Coinbase’s maker/taker fee structure is capped at 0.50%/0.50%. But, that being said, there are still more affordable exchanges on the market, like Binance, ByBit, or OKX, but they might not be as straightforward to use, and it is often worth paying a little of a premium for that convenience. If you just want to add some crypto to your portfolio, it’s probably not worth it. However, if you are serious about crypto trading and looking for more of an advanced platform, it might be worth trying out those exchanges.

The Platform

Platforms & Ease of Use

Kraken

The standard Kraken platform offers a simple, easy-to-use interface for its customers. The trading panel is well organised and aggregates all the information you’d want in a clear, digestible format. Placing an order was simple – just enter the volume of crypto you’d like to buy or sell, and Kraken will multiply that by the current limit price to get the total value of your trade.

While limit and market orders are the most common, Kraken also provides many more options for different order types like stop loss, take profit, stop loss limit, and take profit limit. We tried executing a simple and advanced order and appreciated how self-explanatory the process was and how Kraken laid out all the necessary steps for its users. By default, Kraken makes you confirm your order so you don’t accidentally place a trade with the wrong information.

We liked this extra step because it allowed us to double-check everything; however, you can skip the order confirmation if you want to execute a trade as fast as possible by checking the “skip order confirmation” box.

Kraken Pro

Kraken Pro displays a more complicated trading interface that provides a comprehensive overview (see below). The interface is dominated by a large, advanced charting tool, allowing you to gain a more in-depth analysis of any selected market. The chart has 31 indicators and 20 overlays which is a lot less than other advanced trading charts, but unless you’re a professional trader or hardcore crypto purist, this probably won’t affect your trading experience. It also features basic drawing tools.

We loved how easy Kraken has made it to switch between every available market. Just click “BTC-USD” in the top left corner, and you’re presented with a comprehensive list of markets. You can seamlessly switch between different trading pairs and add markets you want to keep tabs on to your watchlist. To the right of the charting tool is your watchlist, a live order book constantly churning out live trade information, and a trading tool where you can execute trades and access the 7 different order types.

Mobile App

Kraken has two mobile apps: The Kraken App and Kraken Pro.

The Kraken App allows you to track your portfolio, trade crypto, and sort by winners and losers. We found the Kraken app to be fairly simple and easy to use. Users can monitor current prices of different crypto and track their portfolios in real-time. Kraken’s mobile app also allows users to organize their trading experience by sorting by top winners and losers and saving favorite cryptos. For casual buying and selling, the app is great.

Kraken Pro gives users a more powerful experience.

It supports more advanced order types (such as stop loss, take profit, stop loss limit, and take profit limit), margin trading, and detailed graphs and charts. You can also deposit or withdraw existing crypto. The sign-in process for the Kraken Pro app took a few extra steps, but it’s reasonable for the level of security Kraken Pro provides.

While the Kraken Pro app itself does not offer the same technical analysis as the desktop version, we found that the same information is still very easy to access. In the app, navigate to the settings menu in the top left corner, and click on ‘Cryptowatch’. This will take you outside of the app and into your browser, displaying the same trading interface as the Kraken Pro desktop version. You can see the price chart, indicator panels (such as MACD and volume), your trading history, and more, much like the desktop version.

Overall, we were very impressed by the Kraken Pro app.

It’s a great option that allows you to take your portfolio on the go. The comparable trading interface and technical information ensure that you can still make well-informed, sophisticated trades even if you don’t have access to your desktop.

Trading Features

Kraken supports different trading options for all experience levels. Market and limit orders should suffice for those just starting out, but more advanced traders can use stop loss, take profit, stop loss limit, and take profit limit. Unlike Coinbase (its main competitor), Kraken supports margin trading (up to 5x) and futures trading (up to 50x leverage). Kraken also lets you stake crypto, allowing you to earn up to 23% extra on idle crypto in your wallet.

For professional traders or those looking to invest large amounts of capital, more than $100,000, Kraken offers a separate OTC (Over the Counter) exchange. It provides deeper liquidity and a much more personalised trading experience. You’ll receive 1 on 1 consultation from trading desk members with extensive experience at leading financial institutions. They’ll guide you along the way, provide expert analysis of the current crypto markets, and help you with trade execution.

Kraken strikes the perfect balance between offering a beginner-friendly platform and a platform with advanced trading features. Sure, there are better-advanced platforms out there with better features. Still, we think Kraken has provided the perfect starting point for intermediate traders wanting to transition into the more advanced trading realm.

Volume & Liquidity

Liquidity refers to how easily crypto can be traded on a given market. The higher the liquidity of an asset, or an exchange, the quicker trades can be fulfilled and the more competitive the price of that specific trade becomes. Higher liquidity naturally comes with higher volume, as most traders will seek out more liquid markets.

CoinMarketCap provides an excellent tool to study and analyse specific markets, cryptocurrencies, and exchanges. It ranks each exchange based on average liquidity and volume, among other valuable metrics. Kraken is ranked 4th on their list and has average liquidity of 715 and a daily trading volume of $855 million. Compared to the top exchange, Binance, Kraken isn’t far off its average liquidity of 807.

Some notable liquid trading pairs include USDT/USD with a score of 810, making it Kraken’s most liquid pair, and others like USDC/USD and BTC/EUR with scores of 798 and 766, respectively.

You could argue that the 3 exchanges above Kraken are better because they have higher trading volumes and liquidity scores, but we don’t think there’s much in it, and you will have no problem trading with Kraken instead of the top 3.

Additional Features

The Kraken Wallet

Kraken offers a wallet for users to store their crypto when they’re not actively trading. Some wallets only allow you to store a particular type of crypto. Kraken’s wallet allows you to store any asset it already supports on its platform.

Kraken’s wallet is free, and on average, comes with relatively low withdrawal fees. Kraken’s wallet is an exchange wallet as opposed to a dedicated wallet, but if you just want to buy some crypto and leave it on the exchange, you’ll be happy with it.

Staking on Kraken

Kraken supports both on-chain and off-chain staking.

Off-chain staking is only available in certain countries. Kraken supports 18 assets for staking— 15 of them on-chain and 3 of them off-chain. The 3 off-chain assets are Bitcoin, Euro, and the US dollar. The 9 on-chain assets include Ethereum 2.0, Polkadot, Solana, and others. Kraken pays staking rewards twice a week. It also allows you to automatically stake your rewards as well as soon as you get them. This allows you to compound the rewards you earn from staking.

Your rewards will vary based on which crypto you stake. For example, at the time of writing, Kava will yield 23%, Dot 12%, ETH 2.0 5-7%, BTC 0.25%, USD 2%, and SOL 6%.

We staked DOT on Kraken, and we’ve been pleased with both the staking experience and the rewards we generated, but it varies by coin. For example, we find that the 0.25% reward on BTC is low, as is 2% for USD.

Overall, Kraken is a decent staking platform, but nothing to write home about. If you already are there, it makes sense to use the staking offering as well.

Lending/Borrowing on Kraken

Kraken doesn’t currently support lending or borrowing, but you can use margin/leverage trading to buy or sell crypto using funds that may exceed the balance of your account. We only recommend trying margin trading if you know what you’re doing, as it carries significant risk and amplifies the chance of losing crypto through market swings and other things out of your control.

Customer Support

Customer support is an often overlooked feature by most exchanges. Through conducting these reviews, we’ve encountered numerous issues that often require support from the exchange team that no online resources can solve. Kraken has fantastic customer support. It has 24/7 live chat and phone support, a notoriously rare offering from most crypto exchanges, available from 8 am-12 am UTC, Monday through Friday.

It also has an extensive library of support articles, which walk you through all aspects of their platform. Article topics include account setup, security, trading, earning rewards, and many more. Kraken claims it has a 90% client satisfaction score, and most issues are resolved within 24 hours. We tested out the live chat feature, and we were first in the queue, managing to speak to an actual client representative instead of a bot. We think the 90% satisfaction score is justified, and we don’t think many users will have problems rectifying any issues.

NFTs

Kraken currently does not have an NFT marketplace but has one in the pipeline that is currently being developed. Kraken is quite hush-hush about it, so we could only find a tiny bit of information about what it will entail and offer. Some possible features include zero gas fees for trades, support for fiat and crypto purchases from your Kraken account, and support for NFTs across multiple blockchains. You can join a waitlist and stay up to date with any important announcements.

Conclusions

For Beginners

Kraken is a great option for beginner traders who want to learn the basics of crypto and dip their toes in the water. Kraken’s educational articles and its simple interface allow beginners to start slow and easily progress as they feel more and more comfortable.

The platform is easy to navigate, the fees aren’t too high, and Kraken has a good reputation. Sounds like a winner to us, and a good platform to learn about crypto.

For Experienced Traders

Kraken Pro is a good option for more experienced traders, and close to perfect if you consider yourself an intermediate trader looking to take the next step.

Kraken Pro provides useful tools such as different order types, margin, futures, indicator panels, depth charts, and an order book to help experienced traders make well-informed trades. Kraken’s mobile app also supports trading on the go in case you don’t have access to your desktop.

Lastly, Kraken’s OTC exchange is a valuable option for high-net-worth individuals or institutional investors.