Kraken preps for new crypto entrants with institutional-focused offering

“There is plenty of space for more than one institutional crypto offering,” Kraken exec says

article-image

Kraken and Adobe Stock modified by Blockworks

share

Crypto exchange Kraken has debuted a platform targeted at institutional investors in a bid to work with those getting involved in the crypto space.

The company’s new institutional brand was designed to pull existing Kraken offerings into one place for clients, according to Tim Ogilvie, global head of Kraken’s institutional business.

Such services include the company’s spot exchange, as well as its derivatives trading, qualified custody and indices via Kraken subsidiary CF Benchmarks. 

Read more: Kraken, OKX the latest crypto exchanges moving into new markets

“The diversification of the institutional market to include more types of asset managers makes this a timely development, particularly as the institutional adoption of crypto is expected to grow rapidly,” Ogilvie told Blockworks. 

Kraken Institutional’s full product suite is set to launch later this year, including “qualified custody” services offered by Kraken Financial — a Wyoming-chartered Special Purpose Depository Institution.

Various segment firms have drawn up crypto custody services in recent months after the US Securities and Exchange Commission proposed in February 2023 to require the “safekeeping of client assets” to what they call “qualified custodians.” 

Read more: Onramp, BitGo introduce latest iteration of crypto custody

“Kraken’s new institutional brand is less about grabbing existing market share and more about preparing the ground for new entrants as they start to engage in the digital asset class,” Ogilvie said. 

Kraken’s institutional brand launch comes about three years after Coinbase launched the beta version of Coinbase Prime, which offers custody, trading and analytics to institutions. 

The publicly traded Kraken rival more recently introduced a lending platform targeted at US institutional investors in September. It then debuted a smart contract platform letting institutions trade and create new digital assets.

Coinbase said in its fourth quarter shareholder letter published earlier this month that it grew its client base using its trade financing and portfolio margin products in Prime. 

Institutional customers staked $7.4 billion in assets through Coinbase Prime, and the exchange — a custodian for eight of the 10 US spot bitcoin ETFs — notched custodial fee revenue of $20 million during the fourth quarter.

“There is plenty of space for more than one institutional crypto offering,” Ogilvie said. “As more institutional investors start to enter the space, the total addressable market will only grow.”


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

ao cover.jpg

Research

Arweave recently launched the testnet for AO computer, a new messaging protocol that will sit atop a PoS network and aims to become a scalable global compute platform through parallel processing and modularity.

article-image

The US spot bitcoin fund category has notched negative net flows over the course of a week just three times since coming to market in January

article-image

Elsewhere, rank-and-file employees move around and Binance’s head of legal in Europe departs

article-image

Plus, a Dragonfly partner shares his view on the crypto VC market, and a mining hardware firm raises $80 million

article-image

Plus, a Bored Ape burger restaurant closes, and Crypto: The Game presses on

article-image

Bitcoin scarcity is a meme, with or without the halvings

article-image

The current state of blockchain interoperability poses an existential threat to the mainstream adoption of blockchain technology as a whole