Kraken
K-logo-wikipedia.svg
TypeCryptocurrency exchange
LocationSan Francisco, California, United States
Coordinates37°47′24″N 122°24′03″W / 37.790024°N 122.4008331°W / 37.790024; -122.4008331[1]
FoundedJuly 28, 2011; 10 years ago (2011-07-28)
OwnerPayward, Inc.[1]
Key peopleJesse Powell (CEO)[1]
CurrencyCryptocurrencies:[2] BTC, ETH, DOT, ADA, DOGE, XMR
Fiat currencies: USD, EUR, JPY, GBP, CAD, AUD, CHF
Websitekraken.com

Kraken is a United States–based cryptocurrency exchange and bank, founded in 2011.[3][4] It was valued at $11 billion in mid-summer 2022.[5]

History

Kraken was co-founded in 2011 by Jesse Powell, an alumni of California State University, Sacramento with Thanh Luu.[5] Powell was a consultant for Mt. Gox in resolving a security issue, and began working on Kraken as a replacement anticipating its death; Gox would indeed collapse in 2014, failing security audits.[6][5] In September 2013, Kraken was launched, offering Bitcoin, Litecoin, and euro trades initially before going on to add additional currencies and margin trading.[7] In July 2013, Kraken joined other US Bitcoin players to form the Committee for the Establishment of the Digital Asset Transfer Authority (DATA) as the self-regulatory group of the industry.[8][9]

In March 2014, Kraken received a US$5 million Series A investment from Hummingbird Ventures and Bitcoin Opportunity Fund.[10][11] A month later, Kraken became one of the two bitcoin exchanges to be listed on Bloomberg Terminal.[12] The same year, Kraken was chosen to assist with the investigation of lost bitcoins of Mt. Gox; the bankruptcy trustees relied upon Kraken due to its proven operating history without being breached by hackers.[13] In June 2015, Kraken opened the first dark pool for bitcoins.[14]

In January 2016, Kraken purchased Coinsetter (and by extension, Cavirtex), an exchange based out of New York.[15] A month later, Kraken announced the completion of its Series B round of investment led by the SBI Group and acquired Dutch exchange CleverCoin,[16] and Glidera, a cryptocurrency wallet service.[17] In March 2017, Kraken acquired Cryptowatch, a charting and trading platform.[18] By December 2017, Kraken claimed to be registering up to 50,000 new users a day.[19]

In April 2018, Kraken announced closure of its services in Japan due to the rising costs of doing business.[20] In February 2019, Kraken acquired Crypto Facilities, a British derivatives trading firm.[21] In June 2019, Kraken received $13.5 million from 2,263 individual investors via a special-purpose vehicle.[22] In early 2021, Kraken sought additional funding from investors at a valuation of over $20 billion, with Tribe Capital becoming the company's second largest institutional investor behind Hummingbird Ventures and Arjun Sethi being appointed to the board of directors.[23] In January 2021, Kraken released a mobile app for international users, which became available in the US in June 2021.[24] As of June 2022, Kraken is reportedly valued at $11 billion.[5]

Controversies

Identifying Glassdoor reviewers

In May 2019, Kraken filed a motion in California's Marin County Superior Court to identify ten anonymous reviewers on Glassdoor.[25][26] Kraken is suing them, for allegedly breaching their severance contract. The Electronic Frontier Foundation, which represents the anonymous reviewers, claims that identifying the reviewers would harm their First Amendment free-speech rights and chill the expression of others.[27] The court has since ordered Glassdoor to disclose the real identity of some reviewers.[5]

Government regulations

In April 2018, Kraken refused compliance with an investigation by the New York Attorney General's Office regarding the measures taken by cryptocurrency exchanges to protect their customers from market manipulation and money laundering, finding the associated expenditure to be bad for business.[28] The report went on to warn that Kraken might be breaking the law, suggested that customers stay away from it, and referred the platform to New York State Department of Financial Services for potential violation of local virtual currency regulations.[29][30] In late September 2021, it was announced that Kraken would pay a fine of $1.25 million to the Commodity Futures Trading Commission for offering unregistered margin trading.[31][32]

Work culture

In June 2022, Powell urged employees in a work-meeting to reject the usage of preferred gender pronouns; subsequently, he opened a Slack channel to "debate" why people shall be allowed to choose their gender but neither race nor ethnicity.[5] The next day, Kraken released a "culture document" which outlined the "libertarian values" at the "core" of Kraken, that were to be obeyed at work.[5] Among other things, employees were prohibited from labelling others' comments as "toxic, hateful, racist" etc., and particular emphasis was assigned on how "offensiveness" was not forbidden.[5] Powell and his fellow executives encouraged employees who disagreed with the policy to quit.[5]

See also

References

  1. ^ a b c "Company Overview of Payward, Inc". Bloomberg. Retrieved 17 July 2016.
  2. ^ "Cryptocurrencies available on Kraken". Kraken Support. Retrieved 6 November 2021.
  3. ^ "These are the biggest names in bitcoin and blockchain tech". Yahoo! News. Retrieved 2 June 2016.
  4. ^ Reuters Editorial (29 June 2015). "Industry Leading Bitcoin Exchange Kraken Opens in Canada with Vogogo". Reuters UK. Archived from the original on 21 November 2015.
  5. ^ a b c d e f g h i Mac, Ryan; Yaffe-Bellany, David (15 June 2022). "Inside a Corporate Culture War Stoked by a Crypto C.E.O." The New York Times. Retrieved 15 June 2022.
  6. ^ Alpeyev, Pavel (17 August 2014). "Mt. Gox Insider's Kraken Bitcoin Exchange to Open in Japan". Bloomberg News. Retrieved 4 October 2019.
  7. ^ "Sneak Peak: Rising From the Depths of the San Francisco Bay is Kraken". Finance Magnates: Financial and Business News. 3 May 2013. Retrieved 12 February 2018.
  8. ^ Tsukayama, Hayley (30 July 2013). "Bitcoin industry leaders set up standards group". Washington Post. ISSN 0190-8286. Retrieved 12 February 2018.
  9. ^ Sidel, Robin (30 July 2013). "Virtual Currency Enthusiasts to Launch Self-Regulatory Group". Wall Street Journal. ISSN 0099-9660. Retrieved 12 February 2018.
  10. ^ "Bitcoin exchange Kraken raises millions of dollars". CNET. 25 March 2014. Retrieved 12 February 2018.
  11. ^ Chernova, Yuliya (26 March 2014). "Big Day for Bitcoin Startups: Three Startups Haul in $23.5M in Funding". Wall Street Journal. Retrieved 12 February 2018.
  12. ^ "Bloomberg terminals now track bitcoin prices and virtual currency news". Retrieved 12 February 2018.
  13. ^ Mochizuki, Takashi (26 November 2014). "Kraken Bitcoin Operator to Help Liquidate Mt. Gox". The Wall Street Journal. Retrieved 22 February 2018.
  14. ^ "New dark pool addreses [sic] this major headache for Bitcoin traders". Business Insider. Retrieved 12 February 2018.
  15. ^ "Bitcoin exchange for Wall Streeters to close New York operations as part of deal with Kraken". BizJournals.com. Retrieved 13 August 2020.
  16. ^ "Kraken has acquired Dutch Bitcoin exchange CleverCoin". SiliconANGLE. 28 June 2016. Retrieved 15 July 2021.
  17. ^ Flanagan, Will. "Chicago bitcoin startup Glidera acquired by San Francisco digital currency exchange". Chicago Business Journal. American City Business Journals. Retrieved 27 December 2016.
  18. ^ "Crypto exchange Kraken acquires trading platform as bitcoin soars". American Banker. Retrieved 11 February 2018.
  19. ^ Chaparro, Frank (23 January 2018). "Bitcoin exchange Coinbase reportedly made more than $1.25 billion in revenues last year". Business Insider Australia. Retrieved 11 February 2018.
  20. ^ "Cryptocurrency Exchange Kraken Pulls Out of Japan". Bloomberg.com. 17 April 2018. Retrieved 19 April 2018.
  21. ^ "Kraken Raises $100 Million, Acquires London Futures Firm". Fortune. Retrieved 23 May 2019.
  22. ^ "Cryptocurrency exchange Kraken raises $13.5M in BnkToTheFuture campaign". SiliconAngle. 25 June 2019. Retrieved 13 June 2020.
  23. ^ Tan, Gillian (20 May 2021). "Crypto Platform Kraken Adds Tribe Capital's Sethi to Its Board". Bloomberg.
  24. ^ Sigalos, MacKenzie (2 June 2021). "Coinbase rival Kraken launches mobile app in U.S. to capitalize on crypto surge". CNBC. Retrieved 7 October 2021.
  25. ^ Grothaus, Michael (12 February 2020). "Every employee's worst nightmare, getting outed on Glassdoor, could become a reality". Fast Company.
  26. ^ Claburn, Thomas (12 February 2020). "Crypto-upstart subpoenas Glassdoor to unmask ex-staff believed to be behind negative reviews. EFF joins the fray". The Register.
  27. ^ "Payward, Inc. (Kraken) v. Does 1-10 ". San Rafael, California: Marin County Superior Court. 11 February 2020 – via EFF.org.
  28. ^ Cheng, Evelyn (19 April 2018). "Kraken cryptocurrency exchange says it will not comply with New York inquiry". CNBC. Retrieved 3 May 2018.
  29. ^ Castillo, Michael del (18 September 2018). "New York Attorney General Warns That Kraken Cryptocurrency Exchange Could Be Violating Regulations". Forbes. Retrieved 4 October 2019.
  30. ^ Rooney, Kate (18 September 2018). "Crypto exchanges are ripe for manipulation and aren't doing much to stop it, New York AG says". CNBC. Retrieved 20 September 2018.
  31. ^ "Here's Why the CFTC Fined Kraken $1.25 million". The Motley Fool. 29 September 2021. Retrieved 30 September 2021.
  32. ^ Weil, Dan. "Bitcoin Exchange Kraken to Pay $1.25M to Settle CFTC Charges". TheStreet. Retrieved 30 September 2021.