- Kraken’s head of trading talked to DL News.
- Trump's second term has changed the stakes for the exchange.
- New entrants are poised to jump into the market.
The good times are rolling at Kraken.
The US crypto exchange is buoyed by a new demographic of retail traders and institutional investors pouring into the market this year.
And relaxed regulatory scrutiny and support from President Donald Trump is spurring momentum as Bitcoin and other cryptocurrencies surge to unprecedented valuations.
But the big shift has its downsides, too. “It’s both a good and bad thing for us,” Shannon Kurtas, a senior director at the privately-held company, told DL News.
“It’s a good thing because it de-risks our existing business. But, having regulatory clarity means more competition in the medium term from larger traditional venues, exchanges, and counterparties.”
It’s safe to say Kurtas will take it.
Market euphoria
Following Trump’s election victory on November 5, market euphoria helped Kraken’s trading volume soar 148% to $665 billion in 2024, and revenue more than doubled to $1.5 billion.
The rally should also spark a flurry of mergers and acquisitions Kurtas said. Case in point: Robinhood’s $200 million purchase of Bitstamp in June.
The optimistic vibe is a far cry from the days of the Biden administration.
“The regulatory authority means that the risk for other people to enter the market is lower.”
— Shannon Kurtas, Kraken
Led by Chair Gary Gensler, the Securities and Exchange Commission tried to force Kraken, Coinbase, Binance, and other crypto ventures to comply with the Depression-era laws governing stocks and bonds.
Litigation — and much protest — ensued.
In 2023, Kraken paid $30 million to settle a lawsuit from the SEC over the crypto exchange’s staking service. Kurtas declined to comment on the litigation.
Gensler’s reign had a chilling effect on companies with ambitions to debut shares on public markets, said Chris Tyrer, head of strategy at Peter Thiel-backed crypto exchange Bullish.
This has helped listed companies such as exchange giant Coinbase enjoy “an unfair advantage,” Tyrer said at a DL News event in London in late November.
That may soon change.
Strategic options
Kraken, along with Tyrer’s company Bullish, is among several — including Circle, Ripple, and Gemini — that have explored potential initial public offerings.
Kurtas didn’t comment on its IPO plans, but a spokesperson told DL News: “We are always exploring all strategic options available to us to decide what’s in the best interest of the business and its stakeholders.”
Kraken relaunched the staking service for US customers last month, and so far, the new administration is taking a different tack than its predecessor.
President Trump issued a sweeping executive order directly addressing the crypto industry in January. He said the administration would evaluate a crypto strategic reserve and establish a working group to develop new policies for digital assets.
Kurtas said the shift in sentiment after Trump’s election sparked new signups to the exchange and “dormant clients becoming active again,” both among retail and institutional investors.
He also reckons it should become easier for new companies to join the industry.
“The regulatory authority means that the risk for other people to enter the market or to invest more resources is much lower than it was before,” he told DL News. “That would change the calculus for companies over the next four-plus years.”Kurtas said he isn’t too worried about an onslaught of rivals just yet.
“Where there is an increase in competition, it’ll mostly be limited to the major assets,” he said, such as “the simplest instruments, where things will become more commoditised more quickly.”
‘Can’t get enough’
But, he said, Kraken has a competitive advantage.
“We have established a head start,” partly because Kraken operates globally, Kurtas said. “We have our own blockchain engineering — we’re not reliant upon any third party to support assets on our behalf.”
He also said he’s on the hunt for new hires, though declined to say how many or over what time frame. “It’s a very competitive market, a small market, and so we’re constantly on the hunt for top talent.”
The skills most analogous to Kraken’s business are traders who have currency and quantitative trading backgrounds, he said.
“And lawyers. Can’t get enough lawyers.”
Trista Kelley is DL News’ editor-in-chief. Liam Kelly is a Berlin-based reporter for DL News. Got a tip? Email him at liam@dlnews.com.
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