Kraken derivatives trading

Kraken.com Review – Is The Platform Trustworthy?

Kraken cryptocurrency trading platform reviewKraken review and opinions 2021 – Is it a good Exchange?

There are many companies in the world dedicated to cryptocurrency trading but few can boast of having been around for as many years as Kraken, which was born in 2011, just a couple of years after the birth of Bitcoin no less.

Many wonder if it is a good cryptocurrency exchange house or if it is trustworthy. As always that is never fully known until you use the service personally but with this review we will put some doubts to rest. Cryptocurrencies are an unregulated and highly volatile investment product. There is no protection for EU investors.

What is Kraken?

Kraken is one of the largest international cryptocurrency exchange and trading platforms. The Dan Francisco-based Bitcoin broker is one of the oldest crypto trading sites which means that they are highly professional and have more experience than many other companies in this field. One of it’s specialties is that it is even licensed in the US, meaning they are able to offer crypto margin trading with up to 5x even for people from the United States. Other countries have it way easier to find a good margin broker, the most relevant ones are listed here on BestBitcoinBroker.

In 2019 Kraken announced that it had raised over $13 million from private investors to help the company grow, so we see that it is a company that intends to stay in the crypto market for a long time.

Kraken regulation and safety Is it reliable?

Is Kraken regulated?

regulated brokersNot in the sense that traditional brokers in the market such as stocks, Forex, futures, etc. are regulated. The cryptocurrency market is not yet regulated in this way and this means that companies like this one are not regulated by bodies such as the FCA or NFA. However this does not detract from the fact that it can be a safe company. In fact, Kraken has a reputation as one of the safest cryptocurrency houses on the market.

For starters, it is the first crypto company to get a Special Purpose Depository Institution (SPDI) permit in Wyoming, USA, something that gives it an extra security point, as that in itself already forces it to take extra security measures.

  • What are Kraken’s main security features?
  • Maximum storage security
  • This company keeps more than 95% of its deposits in cold wallets, which are known to be the safest in the market.
  • Platform security
  • The company’s servers are under maximum security, with armed guards and maximum protection guarantees.
  • Maximum information security
  • Access to the platform is subject to continuous monitoring. Your private information is fully encrypted at all levels.
  • Penetration testing

Kraken’s team has personnel specialized only in trying to break into the company’s security systems in order to look for any flaws that may exist. This not only further secures the service but also helps to improve the platform’s functionality.

More security details:

  • Follows industry standard and requires the use of two-step verification (Authenticator or Yubikey).
  • Follows industry standard and requires the use of two-step verification (Authenticator or Yubikey).
  • No account recovery by phone or message.
  • Blocked withdrawals are confirmed by email
  • API permissions are customizable
  • Can be locked to increase security when not using the platform
  • Emails are encrypted and PGP signed
  • All web browsing is SSL secured
  • Sensitive data is fully secured under strict encryption
  • Chat support 24 hours a day 7 days a week

Does this mean that it is a 100% secure entity?

Nothing could be further from the truth. No online digital company is 100% secure. Not even the biggest one we can imagine. All companies can go bankrupt due to financial and economic problems.

What we can say is that Kraken seems to be one of the safest exchange houses in the market, and that vetereanía in the same since 2011 also gives a point in favor when considering this company as reliable. At the moment there are no indications that it could be in financial difficulties of any kind.

Customer Service

contact brokerKraken is an exchange that doesn’t beat around the bush when it comes to trying to provide customer service. In many other similar digital companies it is sometimes quite difficult to even find a way to contact them directly. In many cases we get bogged down in the question and answer sections, making it difficult to find what we really want to do.

In the case of Kraken the first thing we have on their support website is a search engine that will help us to ask simple questions about anything related to the account.

Immediately after this search engine, we have the possibility of contacting through a form with different options, depending on the problem.

The other way to contact, even faster, is through the chat that is available on the pages and that works permanently, although sometimes you have to wait a while for an answer.

If we want to participate in the Kraken community, we can do so through social networks. There you can not solve problems related to our account but you can get interesting and updated information. The channels are as follows:

Account opening

Opening an account with Kraken is free and should not take long. You simply register on their website or application. Later to start doing more things, you have to pass different levels of verification. Most commonly we verify our identity and proof of tax residency. This is by providing an identity document such as a passport or ID card, and a copy of a bill from our home where our name is on it. Also things like a bank statement with the address and our name are valid.

In addition to this, we must verify with a selfie type photo, for which we must follow some very simple instructions.

How do I deposit money?

The account can remain open indefinitely without the need to have money. We can withdraw it and leave the account open so that we can also view market conditions and charting functions if we wish.

Platform

Kraken has one of the most modern platforms on the market, with all the functionalities of a derivatives broker and a great trading interface. On the screen we can see the depth of market and order book, as well as advanced charting.

If we do not want to trade we can also use the simple spot trading platform, without the charting functionality but sufficient for normal purchases.

The platform and charts can be configured at will, with different modes, colors, technical indicators and much more. We are undoubtedly facing one of the most powerful platforms in the cryptocurrency world.

At the beginning, only spot cryptocurrency trading was offered, but over the years the industry has developed and now also offers other more advanced types of trading such as margin trading, futures or indices.

Margin trading

Kraken derivatives trading

This type of trading allows you to use more buying power than is allocated in your account. In the case of Kraken the margin level allowed is 5:1, which means that we can buy up to 5 times the value of our account.

As usual with this type of trading it comes with a financing cost. This is normal since trading on margin is equivalent to borrowing money, but in this case it is the exchange that facilitates this transaction. In this case the financing rate is 0.02% every four hours, which is approximately 0.12% interest per day. Therefore, approximately we have to take into account that in case of maintaining an open position for 100 days the interest to be paid would be more than 12%, so it is something that only those who know what they are doing should use.

This type of trading is available for 16 cryptocurrencies: Bitcoin, Ethereum, Tether, Monero, Ripple, Cardano, Litecoin, and so on.

Index trading

indexThis is a fairly new service that is becoming fashionable in the crypto markets. It consists of investing or trading in groups of cryptocurrencies, which are quoted as if they were indexes or ETFs. This is something familiar to those who are used to the world of stock market and index investing.

These indexes are provided by CF Benchmarks. This index is derived from the CME CF Bitcoin prices, none other than the US futures markets, where these types of contracts are already traded.

Despite what it may seem, these instruments are even less risky than individual cryptocurrencies, since the purpose of trading these types of portfolios is to minimize risks, which is logical when many securities are put together in a portfolio. One cryptocurrency can always fail, but it is more complicated for all of them to fail.

Futures trading

This type of trading is similar to margin trading but is even more sophisticated as it allows a higher leverage. For this reason, it is not recommended for inexperienced traders.

Many traders use these futures for the following purposes:

Perform hedging strategies. For example, we have a spot Bitcoin position and we think that the market is going to go down in the short and medium term. We do not sell the spot position and what we do is open a downward future, waiting for our prediction to occur.
Short-term speculating or scalping. This is a very complicated game in which many professionals play. Here you are looking for quick profits in same-day moves, sometimes of a few minutes or less.

With Kraken futures you are trading regulated futures, something that has already taken shape in the United States.

 

What futures does Kraken offer?

Ethereum, Bitcoin, Litecoin, Ripple and Bitcoin Cash.

Leverage is up to 50:1, hence the need for caution when researching these products.

One detail to keep in mind with these contracts is that they offer quite a lot of flexibility, with minimum contracts of 1 USD, 0.01 ETH or 0.001 BTC, which facilitates professional trading.

Over-The-Counter (OTC) trading

This is a service offered by most crypto houses and is intended for trading large amounts of currency, such as more than 100,000 USD or equivalent amounts. This type of transactions is not recommended to be done on the normal platform, but can be done more efficiently on the OTC (Over The Counter).

The minimum order to operate in this way is 100,000 USD and there may be special cases where it will be necessary to talk to customer service.

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