Kraken, a name that has become synonymous with reliability and security in the world of cryptocurrency trading, has earned its place as one of the top exchanges in the industry. Since its founding, Kraken has provided users with a secure and efficient platform to trade a wide range of cryptocurrencies. But when exactly was Kraken founded, and what has contributed to its growth and success over the years?
In this article, we will explore the history of Kraken, from its founding to its rise as a leading cryptocurrency exchange. We will also look into the company’s vision, its growth trajectory, and how it has shaped the world of digital asset trading. By the end, you will have a clearer understanding of Kraken’s journey and its significance in the cryptocurrency ecosystem.
The Birth of Kraken: Founding in 2011
Kraken was founded in 2011 by Jesse Powell, a seasoned entrepreneur and blockchain advocate. Before launching Kraken, Powell had already been deeply involved in the cryptocurrency space. He was inspired by the growing popularity of Bitcoin and recognized the need for a more secure and user-friendly platform for trading digital assets.
The initial idea for Kraken came to Powell after he was introduced to Mt. Gox, one of the first major cryptocurrency exchanges. At the time, Mt. Gox was the dominant exchange, but it suffered from numerous security breaches and user complaints. This left Powell with the idea of building a more secure, reliable, and transparent exchange that would address the problems users faced on platforms like Mt. Gox.
Kraken officially launched in 2013, but its journey began two years earlier, in 2011, when Powell started working on the exchange. He wanted to build an exchange that focused on providing users with a high level of security, regulatory compliance, and transparency, which were sorely lacking in the early days of cryptocurrency trading.
Why Was Kraken Founded?
The early days of cryptocurrency exchanges were filled with challenges, including security breaches, regulatory uncertainties, and a lack of consumer trust. Kraken was founded with the goal of addressing these issues and creating a platform that would cater to both individual traders and institutional investors.
One of the key problems Kraken aimed to solve was the security concerns surrounding cryptocurrency exchanges. In the early 2010s, many exchanges were hacked or shut down due to security vulnerabilities. Kraken set out to create a platform with robust security measures, including cold storage of digital assets, strong encryption, and multi-signature wallets, to protect users’ funds.
Another major issue that Kraken sought to address was the lack of regulatory compliance in the cryptocurrency industry. Many exchanges operated in a legal gray area, which led to concerns about their long-term viability. Kraken, on the other hand, took a proactive approach to compliance. It sought to work with regulators and obtain the necessary licenses to operate legally in various jurisdictions.
The Growth of Kraken
Kraken’s early days were marked by rapid growth and expansion. By 2014, just one year after its official launch, Kraken had already become one of the largest cryptocurrency exchanges in the world. Its commitment to security, transparency, and compliance quickly attracted a loyal user base.
One of the key milestones in Kraken’s growth came in 2015 when the exchange secured a partnership with the U.S. Federal Reserve. This partnership allowed Kraken to offer fiat-to-crypto trading services, making it easier for users to deposit and withdraw funds in traditional currencies like U.S. dollars and euros.
Kraken’s success continued throughout the years, with the exchange expanding its offerings and increasing its presence in the global cryptocurrency market. It became known for offering a wide range of digital assets, including popular cryptocurrencies like Bitcoin, Ethereum, and Litecoin, as well as smaller altcoins. Kraken also introduced advanced trading features, such as margin trading and futures contracts, to cater to professional and institutional traders.
In addition to its growth in the cryptocurrency market, Kraken also made significant strides in regulatory compliance. The exchange became one of the first to obtain licenses to operate in multiple U.S. states and several other countries. It also became a member of the U.S. Digital Chamber of Commerce and the Blockchain Association, both of which are organizations dedicated to advocating for clear regulations in the cryptocurrency industry.
Kraken’s Commitment to Security
One of the primary reasons Kraken has been able to maintain its reputation as a reliable exchange is its unwavering commitment to security. As mentioned earlier, Kraken was founded with the goal of providing a secure platform for cryptocurrency traders. Over the years, Kraken has continued to strengthen its security protocols, ensuring that user funds and data are protected from potential threats.
Kraken uses industry-leading security features, such as two-factor authentication (2FA), cold storage for digital assets, and regular security audits, to minimize the risk of hacks and data breaches. The platform also provides users with the option to use hardware wallets for added protection.
Kraken’s security measures have earned the exchange a reputation for being one of the safest platforms for trading cryptocurrencies. In fact, Kraken has never been hacked, which is a remarkable achievement in an industry that has seen its fair share of security breaches.
Expanding Globally
As Kraken’s reputation grew, so did its international presence. The exchange expanded its services to numerous countries, including Canada, the United Kingdom, Japan, and several European nations. Kraken’s commitment to compliance allowed it to navigate complex regulatory environments in different regions and obtain the necessary licenses to operate legally.
One of Kraken’s most significant international milestones came in 2018, when the exchange launched its services in Japan. Japan is one of the most cryptocurrency-friendly countries in the world, and Kraken’s entry into the market was a significant move. The exchange also obtained a license from Japan’s Financial Services Agency (FSA), further solidifying its reputation as a compliant and secure exchange.
Kraken continued to expand its global reach by launching new features and services tailored to the needs of international users. The platform introduced multi-language support, enabling users from different regions to trade on the exchange in their native language. Kraken also expanded its customer support team to offer 24/7 assistance to users worldwide.
Kraken’s Acquisition of Coinsetter and Cavirtex
In 2015, Kraken made a strategic move to expand its presence in the North American market by acquiring two major exchanges: Coinsetter and Cavirtex. Coinsetter was a popular exchange in the U.S., while Cavirtex was a leading exchange in Canada. These acquisitions allowed Kraken to increase its market share and offer a broader range of services to North American users.
By acquiring these exchanges, Kraken was able to strengthen its position in the U.S. and Canadian markets and offer more competitive services. The move also allowed Kraken to tap into new user bases and gain access to additional liquidity.
Innovation and New Features
Kraken has always been at the forefront of innovation in the cryptocurrency exchange space. Over the years, the platform has introduced several new features and services designed to improve the trading experience for users.
One of the most notable innovations was the introduction of margin trading. Kraken was one of the first exchanges to offer margin trading, which allows users to borrow funds to increase their buying power. This feature has become particularly popular among professional traders who want to leverage their positions and maximize potential profits.
In addition to margin trading, Kraken also introduced futures trading, which allows users to speculate on the price of cryptocurrencies without actually owning the underlying assets. This feature has attracted institutional investors and professional traders looking for more sophisticated trading options.
Kraken’s commitment to innovation has also led to the launch of several new features aimed at improving user experience. These include advanced order types, mobile apps, and integration with third-party tools like trading bots and portfolio trackers.
Kraken Today: A Leading Cryptocurrency Exchange
As of today, Kraken is one of the largest and most reputable cryptocurrency exchanges in the world. It has established itself as a leader in the industry, with a focus on security, regulatory compliance, and user experience. Kraken offers a wide range of cryptocurrencies for trading, including Bitcoin, Ethereum, Litecoin, and many others. It also provides a variety of trading features, such as margin trading, futures contracts, and staking.
Kraken has earned the trust of millions of users worldwide, and it continues to grow and expand its services. The exchange has become a go-to platform for both beginner and professional traders, offering a safe, secure, and reliable platform for cryptocurrency trading.
Conclusion
Kraken was founded in 2011 by Jesse Powell, who sought to create a secure and reliable cryptocurrency exchange that addressed the challenges faced by users in the early days of the industry. Since its official launch in 2013, Kraken has grown into one of the most trusted and respected exchanges in the cryptocurrency space.
With a focus on security, regulatory compliance, and innovation, Kraken has managed to carve out a significant share of the global market. Its commitment to transparency and user protection has made it a go-to platform for cryptocurrency traders around the world.
As Kraken continues to expand and evolve, it will undoubtedly remain a key player in the cryptocurrency industry for years to come.
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