On your way to searching for a centralized cryptocurrency exchange you can trust, you may have heard of Kraken.
But after what happened to the central FTX platform, it is difficult to trust any central platform these days. Is it possible to rely on the Kraken platform?
Especially since it is one of the oldest cryptocurrency trading platforms, as the platform is nearly ten years old. Let’s find out!
Platform history and creation
In 2011, after the famous Mt Gox platform was hacked, Jesse Powell decided to create the Kraken platform.
This is because Bitcoin investors are panicking at this time due to the terrible amount of coins that have been lost from the Mt Gox platform.
Jesse Powell spent two years of development and experimentation to launch his platform, and in 2013, the Kraken platform was launched.
Initially, the platform was dedicated to trading Bitcoin, Litecoin, and the Euro, but the platform soon began to include more pairs of both cryptocurrencies and fiat currencies.
Today, the platform is available in more than 48 states in the United States of America, in addition to all over the world.
It is one of the most famous cryptocurrency trading platforms that has succeeded in gaining the trust of cryptocurrency users. But please be aware that the platform is not yet available in New York and Washington.
The main reason for Kraken’s success in gaining customer trust is that it is a legal platform wherever it operates.
The platform has a legal license in the United States of America, in addition to a license in Canada and a license in the United Kingdom, and the platform is available in Japan and Australia as well. In 2022, the platform succeeded in obtaining a legal license in Abu Dhabi (UAE)!
Security and safety of cryptocurrencies on the Kraken platform
Since the main reason for creating the Kraken platform was that another platform was hacked, the platform must be highly secure.
According to the platform, it has one of the most advanced security devices in the world of Web 3.0. This is because the platform has announced that 95% of all customer currencies on the platform are kept in offline cold wallets.
The platform also applies the principle of decentralization to the fullest, as the wallets are geographically distributed around the world.
In addition, it does not depend on a base currency, unlike other platforms. This makes the hacking process difficult, as many platforms are hacked through their base currency.
What about customer data on the platform?
Since the platform takes all necessary legal measures, this means that it has user data and this data may include sensitive information about them.
Does Kraken make enough efforts to preserve this sensitive information?
The platform confirms that all customer data is preserved and protected, and no one is allowed to enter and view customer data without permission.
Also, those authorized to access customer data have their accounts subject to constant monitoring to ensure that they do not leak customer data to anyone. This information may lead to a customer being stolen or exposing him to blackmail.
Kraken has a dedicated team to try to detect and fix vulnerabilities in the security system as quickly as possible.
The platform also allocates rewards to hackers for trying to penetrate the platform’s security and then communicating with the platform to report vulnerabilities and how to solve them. They are known as white hat hackers.
What cryptocurrencies are available on the platform that can be traded?
Of course, the Kraken platform is secure and highly protected, but this will not be of much use if you do not find your favorite currencies available on the platform, right?
Currently, the Kraken platform supports more than 110 different cryptocurrencies and tokens that you can trade on the platform.
These currencies can be viewed here to decide whether the platform is suitable for you or not.
What are the different KYC procedures on Kraken?
Because the platform is legal and has all the necessary licenses, everyone who registers on it must follow KYC procedures.
There is no alternative to this on the Kraken platform, so if you do not want to do this, looking for another platform will be suitable for you.
Unfortunately, there are not many solutions in the world of cryptocurrencies regarding this.
If you want to maintain your privacy, you must use unlicensed decentralized platforms, but if you want to use licensed and legal platforms, you must follow KYC procedures.
On the Kraken platform, there are four different stages of KYC:
1. The first stage of KYC
The first step that will be required of you after registration is to:
- Activate two-factor authentication.
- Enter your email.
- Your full name.
- Date of birth.
- Phone number.
- Current address.
When you successfully pass this stage, you will be able to deposit into your account whatever cryptocurrencies and funds you want, and you will be able to withdraw what you want, but with limits.
2. Phase 2 KYC is available in the US only
- In addition to all of the above, you will share with the Kraken platform your American Social Security Number.
- Your job.
This level allows you to withdraw and deposit the equivalent of $9,000 per month to your account on the platform.
3. The third stage of KYC
In addition to the above, you will need to provide:
- A copy of your ID card.
- Proof of residence, which may be a bank statement or an internet/telephone/electricity/gas bill.
- If you live in the US or South Africa you will need to provide the platform with your selfie.
This level will allow you to significantly increase your monthly withdrawal level.
4. The fourth stage of KYC
In addition to the above, you will need to answer your own KYC questionnaire and then you will be allowed to do some features on the platform.
It is related to the accounts of professional traders only, and therefore you will not need this stage unless you are a large investor or a professional trading company.
These are the KYC steps. As for the steps to register on the platform, they are no different from the steps to register on any other platform.
However, you will be required to activate two-factor authentication, so do not forget to download Google Authenticator on your phone before registering an account on the Kraken platform.
How to deposit fiat currencies on the Kraken platform
Once you register your account and complete the necessary KYC procedures, you will be able to deposit funds into your account either through bank transfer or bank card.
There are many currencies available on the Kraken platform, including:
- Dollar.
- euro.
- Sterling pound.
- Emirati dirham.
- Japanese Yen.
These are the five most popular currencies used on the platform, and you can deposit fiat currencies through them, but beware that the fees will be very high.
You will be charged 3.75% plus 0.25 cents as an expense, plus 0.9% if you are purchasing Stablecoins.
If you buy cryptocurrencies, the increase will be 1.5% as a trading fee. This means you might lose 5% or 6% of your deposit in fees. But if you don’t mind these fees, click on Buy Crypto.
Click on Add a new bank card and add your bank card, but make sure that it is registered in your name.
After this, choose the cryptocurrencies you want to buy and then complete the purchase process.
This feature allows you to buy cryptocurrencies instantly, but can these fees be avoided?
How to avoid these fees
If you want to avoid these high fees on the Kraken platform, click on Funding in your account, and then choose the method that is appropriate for you.
If you are in the United States, you can use Fedwire, in Europe you can use SEPA, and in the UAE you can rely on UAEFTS.
Make sure you choose the free or lowest-fee option so you don’t pay a lot of fees.
The funds usually arrive in your account within one to five days at most this way. Make sure you follow the necessary steps so that you do not encounter problems while completing the order.
Please keep in mind that your account will not be allowed to withdraw any money from the platform for 72 hours after your first cash deposit. This measure exists to increase security on the platform.
How can I deposit crypto on the Kraken platform?
The first time you deposit a cryptocurrency on the platform, you will be asked to create a deposit address, so click on it, and then send the cryptocurrency you want to send to the platform, and that is all that is required.
But remember these important tips:
- Do not share your cryptocurrency address with anyone. The public address can be shared, but the private address can never be shared with anyone.
- Make sure you are using the correct network. If you are sending MATIC on the Ethereum network and sending it to an address on the Polygon network, you will lose your coins.
- Make sure you are using the best network for your needs. Ethereum for security, for example, and Polygon for speed and low fees.
- Although the Kraken platform is safe, you should not leave your cryptocurrencies on it now due to the panic and fear spreading in the market.
Trading fees on the Kraken platform
The trading fee on the Kraken platform for stablecoins is 0.9% and for other cryptocurrencies is 1.5%, which is very high.
But there is a way to reduce these fees, which is by using Kraken Pro. This way the fees will fall to only a fraction of this number.
If you are a maker in the market, you will be charged 0.16% for each trade, and if you are a taker, you will be charged 0.26%.
These fees decrease as the value of what you trade on the platform increases.
Although these fees are fairly low, there are still other centralized platforms with much better trading fees than Kraken.
What is a Maker and what is a Taker?
If you do not know what the maker and taker fees are, then simply this is what they mean:
- The taker is the one who takes from the market liquidity, and for this reason, his fees are higher.
- Taker is usually related to selling currencies at the market price.
- The maker is the one who increases liquidity in the market and for this reason, his fees are low.
- A maker is usually involved in selling currencies at a limited price.
- This means that the price has to reach a certain limit before the purchase can be made.
What other advantages does the Kraken platform offer?
On Kraken, you can trade via margin options, futures contracts, or leverage trading.
But beware that these options are intended for professional trading experts only. Therefore, do not use these advantages starting as a beginner.
It requires years of experience, professional trading, and risk management strategies to achieve profit from it.
On the Kraken platform, you can get a return on your cryptocurrencies by participating in staking pools and getting a fixed annual return.
Below is a picture of the most popular currencies that can be staking on Kraken to obtain passive income.
If you have reached the third level of KYC on Kraken, you can participate in learning about new projects, especially those on the Polkadot network.
This allows you to invest in these projects when their market value is small. Parachains projects always hold auctions on the platform to obtain seed funding.
Investing in projects with a small market value is the best way to maximize profits, but make sure you are investing in the right project.
The latest feature available on the platform is Kraken Learn, and this academy is one of the most important and famous blockchain learning academies in the world.
It is full of abundant information about the world of crypto, currencies, and different projects. It also contains many videos and guides suitable for beginners and advanced levels.
Conclusion
There is no doubt that the Kraken platform is one of the safest platforms in the world of cryptocurrencies, even if it restricts its customers to many procedures.
But it is regulated and licensed in many countries, and this is certainly the most important feature of the platform. The platform is also ranked among the top 14 platforms on Coingecko.
Its daily trading volume is approximately $800 million, which is a high number that reflects users’ confidence in it.
