Kraken today looks very different from the company it was even two years ago. What was once known primarily as a retail-focused crypto exchange has evolved into a regulated financial infrastructure provider with a clear institutional strategy. With the SEC lawsuit now behind it, a MiCA license in hand, and new products that extend beyond digital assets, Kraken is steadily reintroducing itself to investors — and preparing for what could be a defining capital raise later this year.
Overview of the company
Kraken operates one of the longest-standing digital asset trading platforms globally, but its ambitions reach far beyond spot trading. Its institutional arm, Kraken Prime, provides professional clients with OTC execution, margin, and financing alongside a regulated derivatives marketplace. In Europe, the exchange runs an FCA-authorized multilateral trading facility (MTF), offering futures and perpetual contracts to professional investors. In the U.S., its Wyoming-chartered Kraken Financial subsidiary underpins Kraken Custody, providing qualified, segregated custody solutions with an emphasis on institutional governance.
This dual positioning — derivatives and custody — marks a shift away from the volatility of pure spot trading and toward recurring, compliance-driven revenue. It also highlights Kraken’s efforts to be not just a venue but an infrastructure layer, comparable in ambition to traditional exchanges that anchor market structure.
Market landscape & Competitive positioning
The global crypto exchange market ($100 billion+ in annual revenue by 2028) is highly competitive but bifurcating into two distinct camps: unregulated offshore entities and regulated, compliant onshore operators. This divergence, accelerated by the collapses of 2022 (FTX, Celsius), creates a powerful tailwind for Kraken's specific value proposition.
The competitive framework:
- Binance - Dominates in raw volume and market share but faces existential regulatory pressure globally, including significant SEC charges. Its model is built on a vast array of products and ultra-low fees, but this comes with heightened counterparty and regulatory risk that is increasingly unpalatable for institutions.
- Coinbase - Kraken's most direct comparable. A leader in the US with a strong brand. However, its public listing subjects it to quarterly market scrutiny and investor pressure, potentially limiting long-term strategic flexibility. Its cost structure is also notably higher.
- Decentralized solutions (Uniswap, dYdX) - Represent a disruptive, long-term threat by enabling peer-to-peer trading without a central intermediary. However, they currently face significant limitations in user experience, fiat on-ramps, and the ability to serve institutional order flow, relegating them to a different, though growing, segment.
- Other regional and niche players - Numerous exchanges dominate specific regions (e.g., Bybit, OKX in Asia) but lack global scale and the full trust of Western institutional capital.
Financial model
Kraken leverages a multi-pronged engine designed to monetize user activity across market cycles. The model is built for resilience, leveraging high-margin services to offset volatility in core trading fees:
- Transaction fees
- Spot & Futures trading - Operates a tiered maker-taker model. Fees decrease with higher client volume, strategically incentivizing liquidity providers and high-frequency traders to deepen order books.
- Margin - Earns fees on leveraged trades and a commission on funding rate payments.
- Asset-based revenues
- Staking-as-a-Service - Kraken earns a 15-25% commission on rewards generated from clients' staked assets (e.g., ETH, SOL).
- Earn Programs - Generates yield on a wider array of client assets through lending and DeFi strategies, retaining a spread.
- High-touch services
- OTC desk - Services large block trades for institutions and HNWIs. Revenue is generated via negotiated spreads, providing high-margin, sticky relationships.
Recent performance
The company’s Q2-25 results provide a snapshot of this transition. Kraken reported trading volumes of approximately $187 billion, generating $412 million in revenue and $80 million in adjusted EBITDA. While sequentially softer than Q1 due to seasonal volume patterns, the figures demonstrate resilience and scale, particularly as derivatives and custody grow their share of revenue. Spot exchange fees remain cyclical, but derivatives carry higher margins, while custody creates durable, recurring income streams.
Regulatory footing
Few issues have defined Kraken more than its regulatory battles, and 2025 has marked a decisive turning point. In March, the SEC dismissed its lawsuit against the company with prejudice, ending two years of legal uncertainty without penalties or admissions.
In Europe, Kraken has gone on the offensive: it now holds registrations in Spain and Italy, an e-money license in Ireland, and most notably, in June it became the first major exchange licensed under the EU’s new MiCA regime. The acquisition of Dutch broker BCM added both licenses and operational capacity in the Netherlands, rounding out a strong European footprint. In the UK, it continues to operate its FCA-regulated derivatives MTF, recently reinforced with an e-money license to support fiat services.
As competitors struggle with regulators, Kraken has built a defensible compliance moat across U.S., UK, and EU — the three most critical jurisdictions for institutional capital.
Strategic direction
Kraken’s strategy extends beyond crypto. In April, the company partnered with Alpaca to introduce commission-free U.S. stock and ETF trading, signaling its intent to diversify revenue streams and build a platform that captures more of client wallet-share. In July, it rolled out a U.S. derivatives arm, complementing its European operations and tapping into a high-margin segment long dominated by offshore venues.
The firm has also used targeted acquisitions to accelerate this transition. In 2024, Kraken acquired NinjaTrader, a futures and trading technology platform with a large base of active retail traders in traditional markets. Earlier in 2025, it added Capitalise.ai, an automation platform that enables clients to design and execute algorithmic strategies without coding. These moves broaden Kraken’s addressable market, enhance its technology stack, and reinforce its ambition to be a multi-asset trading and infrastructure provider rather than a pure-play crypto exchange.
Alongside these product expansions, Kraken has streamlined its organization. Following a 15% workforce reduction in late 2024, it continued simplifying its structure in 2025 — a shift framed not as retrenchment but as preparation for scale and operational efficiency.
New round ahead of IPO
Management is now reported to be exploring a $500 million capital raise at a $15 billion valuation. While executives stress there is no urgency to pursue a public listing, the raise would strengthen the balance sheet and give Kraken optionality ahead of an eventual IPO, rumored in early 2026.
The recent acquisitions of NinjaTrader and Capitalise.ai also support this trajectory. By adding futures trading, retail engagement, and algorithmic automation, Kraken is deliberately widening its platform scope in ways that resonate with public-market investors.
The strategy signals an effort to present Kraken not just as a digital asset exchange, but as a diversified, tech-enabled trading platform positioned for scale, resilience, and institutional adoption.
The bottom line
Kraken now represents a very different proposition than it did two years ago. Kraken today is not just a survivor of past cycles but a scaled, compliant operator with real institutional traction. Its regulatory footprint now spans the U.S., UK, and EU, its derivatives and custody franchises are building recurring, higher-margin revenues, and its targeted acquisitions show a clear path toward diversification and IPO readiness.
The challenges — execution, regulatory shifts, and integration — remain, but they are increasingly manageable relative to the upside. For investors looking for institutional-grade exposure to digital assets, Kraken stands out as one of the few platforms at global scale with both resilience and growth optionality. Should the upcoming raise close near its targeted $15 billion valuation, it could mark the beginning of a new phase: positioning Kraken not just as a crypto exchange, but as a long-term infrastructure play in global markets.
Published by Samuel Hieber
