Kraken is a cryptocurrency exchange based in the United States. Since its birth in 2011, the exchange has undergone tremendous improvements. While it has accumulated a fair share of support in the crypto industry, it has also attracted criticism for a few unethical behaviors.
Below are 8 things about Kraken you must know before signing up. If you have started using the platform, it’s likely you have already forgotten about them.
Kraken is not a stranger to downtimes which are caused by the platform not being able to handle a vast amount of traffic. The platform has in the past experienced frequent downtimes causing discomfort to users. In the cryptocurrency space, a virtual currency exchange going offline is feared to be security.
To address the frequent site outages, Kraken overhauled its trading engine in a process that took two days. With the overhaul scheduled to take a few hours, extending it to two days was viewed as a hack or worse still, Kraken was out for good.
But with frequent updates on its social media pages, users were kept in the know, and it eventually came back online. To reward users for their patience, the exchange scrapped off trading fee form Jan 13 to Jan 31, 2018.
2. Kraken Security
Kraken is among the safest virtual currency exchanges in the world. The exchange employs a combination of hot and cold wallets in storing funds. The cold wallet stores a massive amount of the funds. The cold storage is then stored in a secure location.
Since a cold storage is only connected to the internet when needed, it lowers the risk of losing funds in the event of a security breach.
Apart from using a cold wallet to safeguard digital currencies, Kraken encrypts all of its data. Additionally, to protect customer data, the exchange has boundaries on how much client data its staff can access.
For user account security, the exchange has an activate two-factor authentication. There is also another setting, the Global Settings Lock, that allows a user to hide their sensitive information and locks any attempt to change their account settings for a given period. Once activated, the lock takes three days to deactivate. Kraken users also have the option to encrypt all emails sent by the exchange to prevent interception.
3. Kraken Customer Support
The exchange maintains a detailed help section that users, both new and veterans, can visit to seek answers to their queries. Kraken also has a customer support email.
4. Supported Countries, and Currencies
Kraken is available from several countries including the United States, Europe, and Canada. Users in these jurisdictions are allowed to purchase cryptocurrencies using the British Pounds, U.S dollar, Canadian Dollars, and the Euros.
Kraken supports a wide range of cryptocurrencies which includes Bitcoin (XBT), Ethereum (ETH), Ripple (XRP), Monero (XMR), Litecoin (LTC), Dogecoin (XDG), Ethereum Classic (ETC), EOS (EOS), among others.
5. Kraken Futures
Kraken Futures is a platform which was previously known as Crypto Facilities and based in the United Kingdom. The renaming was done after Kraken bought the UK-based firm. Trading futures on the platform can have a leverage of up to 50 times. When launching the futures platform, only BTC, ETH, LTC, and BCH had a leverage of up to 50X. XRP which was paired against the U.S dollar and BTC had a leverage of up to 25X.
6. Kraken Margin Trading
Apart from Futures, Kraken also supports Margin trading. Here, the leverage allowed does not exceed 5X. Note that the currency used in the initial margin coupled with your account verification level determines the margin trading requirements. Unfortunately, not so many altcoins can be traded on margin.
7. Kraken Fees
Kraken charges fiat deposit and withdrawal fees as well as crypto withdrawal fees. For example, users in Europe using SEPA are exempted from fiat deposit fees with withdrawals attracting a fee of 0.09 Euros. U.S users are charged a deposit/withdrawal fee of 5 U.S dollars for bank wire transfers.
Additionally, those conducting bank wire transfers outside the U.S and using the Euro are charged a deposit fee of 10 Euros. Those outside the U.S but perform bank wire transfers are charged 10 and 60 U.S dollars for deposits and withdrawals respectively. Canadians enjoy free fiat deposits but incur a withdrawal fee of 10 Canadian dollars and are limited to transfer a maximum of 25,000 Canadian dollars within 24 hours.
For virtual currencies, deposits are free, and withdrawal fees depend on the crypto being withdrawn. For example, Bitcoin attracts a withdrawal fee of 0.001 BTC while Litecoin attracts a withdrawal fee of 0.02 LTC.
When it comes to trading, Kraken charges fees depending on the trade volume. For example, trades with a volume of less than $50K have a fee of 0.16 and 0.26 percent for the maker and taker respectively. For trades with a volume above $50K, the maker and taker fees are 0.14 and 0.24 percent respectively. Observe that as the volume rises, the fees drop. Trade volume is calculated within 30 days.
8. Kraken Trading Limits With Account Tiers
Kraken places user accounts in tiers which also influence the trading limit. The system has five levels starting from tier 0 to tier 4. Notably, each tier requires a different level of verification. For example, tier 0 users are only required to provide a valid email address. However, they are only allowed to take a stroll on the site and can’t trade, deposit or withdraw funds. On the other hand, users on tier 3 are required to submit a government-issued identification document plus proof of residence. When verified, in addition to enjoying the features of the users on tier 1 &2, users on tier 3 have high fiat currency funding levels.
Kraken surpasses other leading cryptocurrency exchanges in terms of features. Its account tier system provides a way to segment users depending on the amount of personal information provided. Additionally, allowing futures and margin trading gives it an edge over other virtual currency exchanges.
Although Kraken has had operating difficulties in the past, it has since risen above its challenges to provide a reliable cryptocurrency trading platform.
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