Kraken Launches New Crypto Platform for Institutional Investors

Kraken, a leading crypto exchange, has introduced a new platform aimed at institutional investors, streamlining its services to attract those exploring the cryptocurrency sector. This strategic move, overseen by Tim Ogilvie, head of Kraken's institutional business, consolidates the exchange's key services—such as spot exchange, derivatives trading, and custody—under a single institutional brand. The initiative is timely, addressing the expanding institutional interest in cryptocurrencies as more diverse asset managers enter the space. According to Ogilvie, this broadening of the market is a sign of the fast-paced adoption of crypto by institutions, a trend he discussed with Blockworks.

Kraken Institutional is set to launch its complete product range later this year, focusing on "qualified custody" through Kraken Financial, a Wyoming-chartered institution. This launch aligns with the SEC’s recent proposal emphasizing the importance of securing client assets with qualified custodians, pointing to tighter regulatory scrutiny. Kraken’s focus on institutional clients marks a strategic shift towards nurturing new entrants in the crypto market rather than just competing for existing shares. This approach is about preparing for the influx of institutional investors, which is expected to expand the market significantly.

This development follows three years after Coinbase, Kraken's rival, launched Coinbase Prime, targeting institutional investors with custody, trading, and analytics services. Despite Coinbase's advancements, including a lending platform and a smart contract platform for institutional clients, Kraken remains optimistic about the growing market. Ogilvie believes there’s ample space for multiple institutional crypto offerings, with the entry of more institutional investors into the market indicating a growing demand. Kraken’s initiative signals its commitment to being at the forefront of providing comprehensive services to institutional clients, underscoring the increasing acceptance of cryptocurrencies as a valid asset class among these investors.