James Richardson
Kraken has officially rolled out derivatives trading in the United Kingdom, marking a significant milestone in the exchange’s expansion strategy. The new service, however, is exclusively available to clients classified as “Professional” by the U.K.โs Financial Conduct Authority (FCA).
According to Alexia Theodorou, Head of Derivatives at Kraken, the launch began as a soft rollout targeting select users.
โWe started with a small group to ensure a smooth experience,โ she said. โNow, the service is fully open to all eligible clients who complete the onboarding process.โ
Derivatives trading currently accounts for 70% to 75% of the global crypto market volume, a trend Kraken is determined to capitalize on. While Krakenโs spot and derivatives trading are currently neck and neck, Theodorou noted that the derivatives segment is growing much faster, especially with institutional investors increasing their presence in the crypto space.
โThis is a strategic investment for us in the U.K. market,โ Theodorou emphasized. โThe demand from institutions is clear, and expanding access to our flagship derivatives platform is a natural next step.โ
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Krakenโs U.K. derivatives offering operates through its Multilateral Trading Facility (MTF) โ a regulated platform managed by Crypto Facilities, a Kraken subsidiary. Crypto Facilities was the first crypto firm to receive an MTF license from the FCA back in 2020. Kraken acquired the company in 2019 for over $100 million, establishing a strong regulatory foundation for its futures business.
Access to the platform is made available through Krakenโs Bermuda-based futures broker, enhancing both global compliance and operational efficiency.
Multi-Collateral Contracts for Institutional Flexibility
Krakenโs MTF offers advanced derivative products, including multi-collateral perpetual contracts, which provide traders with the flexibility to use various assets as collateral while employing leverage.
These products are particularly attractive to institutions looking to hedge risk or implement market-neutral strategies alongside their spot positions.
โThese contracts offer a capital-efficient way to trade, allowing institutions to experiment with more complex strategies,โ said Theodorou.
Regulatory Barriers Remain in Other Regions
Despite its growth in the U.K., Kraken continues to face regulatory limitations in markets such as the U.S., South Korea, and parts of Europe.
โUnlike the spot market, which is just now being standardized through regulations like MiCA, derivatives have always been tightly regulated,โ Theodorou explained. โEach country requires specific licenses that take time to secure.โ
However, Kraken is actively expanding its regulatory footprint โ recently acquiring a MiFID II-compliant entity in Cyprus and purchasing U.S.-based NinjaTrader, hinting at plans for future launches in both regions.
Expanding Beyond Crypto: U.S. Equities Added
As part of a broader diversification effort, Kraken has begun offering U.S. stock trading through its mobile and web platforms, signaling a move beyond pure crypto assets.
This expansion aligns with Krakenโs reported ambitions to go public, following a strong 2024 in which the company generated $1.5 billion in revenue.
โOur licensing roadmap will determine which jurisdictions we prioritize next for launching regulated products,โ added Theodorou.
