Founded in July 28, 2011 Kraken is the largest Bitcoin exchange in euro volume and liquidity. Kraken is owned by Payward Inc. and the CEO is Jesse Powell. The exchange is headquartered in San Francisco and serves users from the entire of North America, Canada, European Union and Japan. Their platform supports English and Japanese, these can be a disadvantage looking at other exchanges which offer more language options. A great thing about Kraken is that you can purchase a wide range of cryptocurrencies with fiat currencies, including US dollars, euros, British pounds, and Japanese yen. There’s also the option of margin trading for more experienced users. Kraken’s interface offers plenty of options, but it isn’t beginner friendly. After their funding, Kraken raised $6.5 million from 13 investors, including Money Partners Group, Blockchain Capital and Digital Currency Group. Following the bankruptcy of Mt. Gox, the trustees of the receivership picked Kraken as the platform through which claimants could apply to receive lost funds. In 2017 Kraken was struggling to cope with increasing demand for cryptocurrencies, resulting in users receiving many different error messages.
To sing up for Kraken you won’t need any extra information, it is like any other online platform. The first step when signing up is to input your email address and create a password, you also have the option to share a PGP (Pretty Good Privacy) public key to the platform that can be used for adding security when sending you emails. You’ll receive an email with an activation key that you then copy and paste into a second form. With this done, you gain access to your account. The entire process takes between five and ten minutes and no problems with registration were ever reported. Upon opening an account, in the verification section, you can see five different account types (scaled from 0 to 4).
Like all regulated exchanges, you will have to verify your identity and personal details before buying. You can’t make deposits or withdrawals with a basic Tier 0 account. To really get the feel of Kraken, you need to upgrade to tier 1 account.
Tier 1 account
To register as a tier one, users need to update their profile with their full name, date of birth, country of residence and telephone number. Repost time can be from one to three days after providing these details to be verified as a tier 1 account. The waiting period can be longer for people outside North America, Europe and Japan. Users can only withdraw less than $2,500 worth per day and $20,000 per month. The account allows trading between different cryptocurrencies, but not between cryptocurrencies and fiat currencies.
Tier 2 account
To qualify for tier 2, users need to share their postal address with the exchange. Just like the previous tier, users may have to wait for several days for approval. Tier 2 users are able to withdrawal $2,000 a day and $10,000 a month of fiat currencies. When it comes to cryptocurrencies withdrawal it is increased from $2,500 to $5,000 and monthly limit up to $50,000.
Tier 3 account
Tier 3 can be considered for a serious trader. Withdrawal and deposits for fiat currencies are up to the daily limit of $25,000 and a monthly limit of $200,000. The amount of cryptocurrencies you are allowed to deposit daily rises to $50,000 and monthly to $200,000. To verify for a tier 3 account, users need to provide a government-issued ID and verify proof of residence by providing a copy of a utility bill no more than three months old. Users are also required to upload an ID-confirmation photo, alongside a handwritten, signed and dated note reading: “Only for trading digital currency on Kraken”.
Tier 4 account
The highest tier is reserved for corporate entities or for individuals trading at high volumes. Accounts in tier 4 can deposit daily amounts of up to $100,000 in fiat currency and $500,000 monthly. Withdrawal limits for both fiat and cryptos are $100,000 daily and $500,000 monthly. To get a tier 4 account, you need to contact support.
Make a deposit
To make a deposit, you need to log in and go to Account-Funding-Deposit. Fiat deposits and withdrawals are completed through SEPA, Swift, and bank wires. US users can deposit and withdraw through bank wire service, which costs $5. Bank wire transfers from outside of the US cost $10, €10 or £10. Users from Canada, can deposit or withdraw Canadian dollars (CAD) through bank wire at no cost. Users in the European Economic Area can deposit and withdraw using free SEPA wire transfer. Japanese users can deposit and withdraw any amount below ¥5,000 through bank deposits free of charge.
To withdraw fiat currencies, users first need to add and save a new withdraw method to your Kraken account. In the Funding page, under withdrawal users can choose a method from the drop menu. After adding the initial information about the bank account, users can make their withdrawal. To withdraw digital currency, users just need to add the address of the wallet where they wish to send the amount.
Withdrawal fees for fiat currencies:
EUR SEPA Withdrawal – EEA countries only (€0.09)
USD (Domestic) Withdrawal – available in 48 US states + DC ($5)
USD SWIFT (SMBC): available in most countries ($60)
EUR SWIFT (SMBC): available in most countries (€60)
JPY Domestic Withdrawal – Japan only (¥300)
CAD EFT Withdrawal – Canada only ($10 CAD flat fee)
Kraken is more beneficial to users that are not from the US. They have high liquidity, especially for EUR and JPY. For euros deposits or withdrawals are cheap, in some situations they are free. They support margin trading and short selling.
Sometimes website has error and delays in performance. For Canadian and US users fees can be very expensive. Unlike other exchanges, they do not have a wide variety of pairs to begin exchanging. Some errors can include bad execution of orders.
Kraken has drawn a huge amount of criticism in recent months due to its inability to cope with increased traffic. An update that happened in 2017 seems to have cleared these problems. Other criticisms of Kraken include its user interface, which isn’t the most beginner friendly. Many users complain about Krakens support, but including a recent overload, they will manage this soon.
It has been running since 2011, which produces a track-record longer than most, without any serious issues and it’s still dealing with the Mtgox debacle. Anyone sensible enough would wait until the customer care issues and the slowdown are resolved before entering the exchange with new funds, but if you live in Europe, Kraken might be your first and most pertinent choice. Overall, it’s fair to say that Kraken is an option well worth considering thanks to its excellent security features and low transaction fees. However, it’s not the best option for beginners due to its more complex interface.