Kraken Review 2021 and A Definitive Guide to Using the Popular Crypto Exchange

So, you have chosen to check out what all the fuzz about cryptocurrencies is and you have decided to invest some money in them. But where are you supposed to find these cryptos? Well, at the moment, the easiest way to get your hands on these digital currencies is through a cryptocurrency exchange. Today, there are hundreds of cryptocurrency exchanges, however, just some of them stand out for their services. Some of the major crypto exchanges are Binance, Coinbase, Kraken, and Uniswap.

Throughout this article, we will review Kraken – a cryptocurrency exchange giant. Moreover, we will elaborate on how Kraken works, what cryptos does it support, and what makes it unique.

What is Kraken?

First off, Kraken Exchange was founded in 2011 by Jesse Powell, making it one of the oldest cryptocurrency exchanges out there. Kraken aimed to accelerate the cryptocurrency implementation process through a platform that allowed investors to buy crypto securely and quickly. Unlike Uniswap and Pancakeswap, Kraken is a Centralized Exchange, meaning that there is a central authority and you do not have full control over your own assets stored there. Furthermore, Kraken uses the traditional trading system that consists of an order book, the buyer, and the seller.

Kraken is part of the top 5 centralized cryptocurrency exchanges, with hundreds of trading pairs available – be that crypto-to-crypto or crypto-to-fiat pairs. According to Coinmarketcap, Kraken has a trading volume of $1.36 billion, making it the fifth-biggest CEX by trading volume. We must also note that Kraken has more than 2 million weekly visits and supports 7 different fiat currencies; with them being EUR, USD, GBP, CAD, JPY, CHF, and AUD.

Kraken is characterized by its extremely simple user interface and its many layers of security. Even though Kraken has lower fees than most cryptocurrency exchanges, there are exchanges that charge way less for a trade – Binance for instance. Like many other CEXs, Kraken also has a free Pro version that is built for more experienced traders. Yet, we must mention that the cryptocurrency market is highly volatile no matter the trading platform. That being said, investors, rookies & experts alike, should tread carefully when investing in this market. 

Kraken Features

As we stated earlier, its easy-to-use mechanism and high security are what make Kraken so frequented by new investors. However, Kraken also has advanced investing options built for more experienced investors and traders; and when these features are combined, they build one of the most powerful exchanges out there.

Simple Interface

Cryptocurrencies sound very complicated at first sight, and when that is combined with excessive buttons, numbers, and candles, new investors get so confused that many just decide to give up. But not when it comes to Kraken. All you have to do in order to buy crypto using Kraken is deposit your funds and select the amount of the crypto of your choice. This is done through its Instant Buy option that is implemented perfectly on its platform.

Advanced Investing/Trading

To add to its fancy platform, many advanced options for investing in cryptocurrencies can be found within Kraken. One of the main features is Margin Trading, a very risky type of investing that is less common on other platforms that are available in the United States. The investors participating in this type of trading may experience massive gains or even lose a huge amount of their investments. This type of trading also comes with additional costs.

Kraken Pro

Kraken Pro is the advanced platform that Kraken offers for more experienced traders. For rookies, this version seems ‘complicate’, therefore, it is not recommended if you are not familiar with trading. Using this version also means that you will have fees lower than 0.26% – some fees go as low as 0%. Unlike the classic version, Kraken Pro also includes the Market, Limit, and Stop Orders which help a trader execute each trade more precisely.

Kraken Review - A Definitive Guide to Using the Popular Crypto Exchange
Kraken Pro Trading View. Source: Kraken Pro

Kraken Staking

Staking is the process of locking your crypto assets to secure transactions and getting rewarded in return. This process is thought to be a great way to earn passive income since all you have to do is hold onto your crypto (HODL). In Kraken, you can stake cryptocurrencies such as Polkadot and Cardano; additionally, you can even stake fiat currencies like Euro and the US Dollar.

Related: Passive Income with CRYPTO – Best Methods for 2021 REVEALED

Kraken Review - A Definitive Guide to Using the Popular Crypto Exchange
Guide to Staking in Kraken. Source: Kraken

What are the Pros and Cons of Kraken Exchange?

Now, let us elaborate on what the pros of using the Kraken Exchange are.

Pros

Outstanding Security

Many cryptocurrency exchanges have suffered major cyber attacks that resulted in the loss of billions of dollars in crypto. Even Binance, the biggest cryptocurrency exchange out there, was hacked back in 2019. More than 10 years have passed since the launch of Kraken and its platform never encountered any breach or major hack. Moreover, the layers of security that you are required to implement when verifying your identity just make this aspect of Kraken better. You will be required to create a Master-Key and many google authenticator codes, just to name a few. This undoubtedly makes Kraken one of the most secure exchanges out there.

Cryptocurrency Availability

There are hundreds of cryptocurrency exchanges available today, however, not all of them include a variety of cryptocurrencies. In this particular aspect, Kraken does not fail to amaze; with more than 72 cryptocurrencies available for trading. Some notable cryptos tradeable on Kraken are:

Supports Staking

As we mentioned above, the Kraken Exchange supports staking your crypto. This means that your crypto will generate returns for as long as you hold onto it. Kraken pays out these returns twice a week. We must note that Kraken supports two types of staking: On-Chain Staking & Off-Chain Staking. However, Off-Chain staking is limited to some countries only.

Cons

After briefly looking at pros, we must also touch upon the cons of the Kraken Exchange.

Kraken Fees

We mentioned that Kraken allows you to instantly buy cryptocurrencies through its Instant Buy platform; however, this feature is somewhat of a “double-edged sword”. Even though it is a great way for new investors to buy crypto quickly, it comes with a 1.5% fee. If that was not enough, a 3.75% +$0.25 fee will be added per transaction using a Debit/Credit card. These fees are way lower when using Kraken Pro, of course.

30-Day Volume (USD) Maker Taker
$0 – $100k 0.16% – 0.14% 0.24% – 0.26%
$100k – $1 million 0.12% – 0.08% 0.22% – 0.18%
$1 million – $10 million 0.06% – 0.02% 0.16% – 0.12%
>$10 million 0.00% 0.10%

Slow Verification Process

There are different levels of verification in Kraken, and all of them have their own unique features and perks. Furthermore, they also have different verification times. For example, opening and verifying a starter account that is not eligible for trading takes about 1-2 minutes; yet, if you want to reach the Pro-Personal level, you must wait 5 business days. This process is known to take even longer sometimes.

Level Time Deposit Cash Withdraw Cash Staking Margin Trading
Starter <2 minutes N/A N/A On-chain X
Express <1 minute $9k lifetime limit $9k lifetime limit N/A X
Intermediate <5 minutes $100k daily limit $100k daily limit On-Chain

Off-Chain

Pro +5 days $10M daily limit $10M daily limit On-Chain

Off-Chain

Kraken vs. Coinbase

If we compare the two giant exchanges, Kraken and Coinbase, not much difference can be noticed. Both of these cryptocurrency exchanges have been around for quite a while and are well-trusted. Moreover, they both stand out for being efficient ways to buy, sell, or convert crypto – or even store crypto.

In order to help you decide which one you should use, we will look at some smaller details. When we look at the fees that come with using these two CEXs, Kraken Pro’s fees are cheaper, with the highest being 0.26%, whilst Coinbase Pro’s sit around 0.5%.

Even though both of these cryptocurrency exchanges stand out for their easy-to-use interface, one tends to be a little more complicated than the other – and that is Kraken. Therefore, Coinbase may prove to have a more user-friendly interface for crypto newcomers.

Related: Coinbase Review 2021 – What are the Pros and Cons of Coinbase?

According to the cryptocurrency Youtuber known as CoinBureau, Kraken is way ahead of Coinbase in terms of fees, functionality, and customer support. In the end, he states that Kraken is a bit better than Coinbase when taking all of their pros and cons into consideration.

 

How to Open a Kraken Account?

Opening a Kraken account is pretty simple. In order to open one, simply follow the steps we have listed below.

  1. Go to Kraken.com and tap on “Create Account”
  2. Fill in the gaps required with your personal information, and tap on “Create Account”. Make sure to read their Terms of Service and Privacy Policy.
  3. Confirm your email to activate your account.
  4. You have officially opened a Kraken account. Now, you are can deposit cryptocurrency and start to trade. Additionally, you may begin your verification process in order to become eligible to buy crypto through Kraken.

How to Buy Cryptocurrency on Kraken?

You can buy cryptocurrency on Kraken in 4 simple steps:

Step 1: Open a Kraken Starter account by following the steps we mentioned above

The first step towards being able to buy using the Kraken Exchange is to open a Starter account using your legal full name, email, and country of residence.

Step 2: Verify your account to reach the Express, Intermediate, or Pro level

After successfully creating a Starter account, you will be required to level up your account to be able to buy cryptocurrency using cash. Any account level above Starter works, however, you should aim for the level that fits your investment type.

Step 3: Choose your payment method

There are numerous ways you can pay to get crypto through Kraken. You can either deposit some fiat currency onto your account or you can directly buy the cryptocurrency of your preference. These can be done through a credit/debit card, SEPA transfer, SWIFT transfer, Wire transfer, or FedWire. Each of these methods of payment depends on the country of residence and the deposit fees differ for each one. For example, a SWIFT transfer using Swiss Franc (CHF) has a deposit fee of only 0.75 CHF while a SWIFT transfer using the Great British Pound (GBP) comes with a deposit fee of £3.00.

Step 4: Choose the preferred cryptocurrency

After you have decided on the payment method you will use, locate the cryptocurrency you are interested in. Now, enter the amount of crypto you can afford to buy with the deposited funds and press “Buy”. After pressing on “Buy”, you will be shown the price of the crypto you chose, the amount of cash you allocated to execute the trade, and the fees that come with it. If using a phone, under this information, you will have a “Swipe to Confirm” button that you are supposed to swipe to conclude the trade.

Kraken Review - A Definitive Guide to Using the Popular Crypto Exchange
The information shown before the trade is executed. Source: Kraken Support

Kraken Review - A Definitive Guide to Using the Popular Crypto Exchange
The “Swipe to Confirm” button. Source: Kraken Support.

Kraken Review - A Definitive Guide to Using the Popular Crypto Exchange
This screen is shown after a trade is executed. Source: Kraken Support

Read more: How To Buy Cryptocurrency? – A Step-By-Step Guide

Frequently Asked Questions (FAQ)

Is Kraken safe?

As we mentioned before, Kraken is one of the safest exchanges out there. They claim that they store 95% of all the crypto holdings of their users on heavily guarded cold wallets. Moreover, they provide many layers of individual protection. That being said, if your account is compromised, that is on you.

How to Sell on Kraken?

Selling cryptocurrency on Kraken is as simple as buying crypto on it. All you have to do is select “Sell crypto for cash”. Choose the cryptocurrency that you want to sell and click on it. Type the amount that you want to sell and execute the trade. Now, all you have to do is “Swipe to Confirm”.

Is it worth using Kraken’s Instant Buy option?

It depends. Even though this way of buying crypto is quick and easy, it is more expensive. The Instant Buy feature is a great thing to use if you are new to the cryptocurrency world and do not understand how these things work. However, if you are a more experienced trader, there is no need to pay extra fees when you can use Kraken’s advanced trading options on Kraken Pro.

Takeaways

  • Founded in 2011, Kraken is one of the longest-standing cryptocurrency exchanges around.
  • Similar to Binance and Coinbase, Kraken is a Centralized Exchange (CEX) that has a central authority and is regulated.
  • For more experienced traders, Kraken offers a more complex version of itself called Kraken Pro.
  • Kraken allows you to stake your crypto holdings on its platform through On-Chain & Off-Chain staking.
  • The most notable aspects of Kraken include its top-notch security, cryptocurrency variety, and staking system. On the other hand, the drawbacks of this exchange are its fees and its slow verification process.
  • According to Coinmarketcap, Kraken is the fifth biggest CEX by trading volume.
  • All in all, Kraken is a great place to buy, sell, or even store your cryptocurrency, no matter the experience level that you have.

 

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