- Kraken has announced plans to offer US-listed stocks and ETF trading in both the US and the UK
- A new division, Kraken Securities, will launch the service in 2024
- Kraken faces challenges in the competitive zero-commission space, as the retail trading frenzy of the Covid-19 era has waned
Crypto stalwart Kraken is preparing to offer US-listed stocks and exchange-traded funds to US and UK users, according to Bloomberg. The outlet cited a Kraken insider as saying that the exchange, which has been operational since 2011, is looking to diversify its portfolio and take on giants such as Robinhood. Kraken has lost market share to the likes of Binance since 2017 and is seeking a new route to bringing customers in.
Licensed to Sell
Bloomberg reports that Kraken will introduce stock and ETF trading in both the US and the UK through a newly established division called Kraken Securities. This new division has already secured the necessary regulatory permits in the UK, and it has submitted an application for a broker-dealer license in the United States through the Financial Industry Regulatory Authority (FINRA). The service is not expected to launch until 2024.
Founded in 2011, Kraken is a well-established name in the cryptocurrency industry, having weathered multiple market downturns and still stuck around thanks to its solid performance and security. This strategic move by Kraken’s CEO, Dave Ripley, is not without its challenges, placing Kraken in direct competition with established zero-commission players like Robinhood and Public.
Moreover, the retail trading frenzy that was ignited by the Covid-19 pandemic has largely subsided, leading to suggestions that the retail stock trading sector has boomed and busted.
Kraken Spreading its…Fins?
In July 2020 Kraken became become the first cryptocurrency exchange to be granted a Multilateral Trading Facility license by the UK’s Financial Conduct Authority (FCA), allowing it to offer futures products to institutional clients, while three months later it gained a banking license in the UK.
In addition to its equities expansion, Kraken is also actively developing its prime brokerage services and intends to launch a qualified custodian service for institutional clients in the near future. This custody service will operate independently from the exchange, with Kraken already having applied for regulatory approval from the state of Wyoming for this service.
