If you are interested in cryptocurrency, you may have heard of Kraken, one of the world’s leading and most trusted crypto exchanges. It supports over 200 cryptocurrencies and eight fiat currencies, including USD, EUR, GBP, CAD, CHF, JPY, AUD, and NZD. It also offers a mobile app, a pro trading platform, a futures platform, and a staking service.
But how safe is Kraken as a platform? Has it ever suffered any security breaches or hacks? And how does it compare to other exchanges like Coinbase? In this article, we will explore these questions and more using the most up-to-date information and data available.
Let’s get started.
Is Kraken trusted?
Kraken is a trusted and secure cryptocurrency exchange that has been operating since 2011 and has built a reputation for security and transparency. Based in San Francisco, it offers a diverse range of over 200 coins, including some unique alt-coins, that appeal to investors and traders in around 190 countries. Moreover, the platform’s focus on security gives confidence to those who want to safeguard their assets.
Kraken is trusted by over 10 million users, as well as institutions, governments, and regulators. It is one of the first exchanges to be legally compliant in multiple jurisdictions, such as the US, Canada, Japan, and the EU.
Some of the reasons why we think Kraken is one of the most trusted exchanges today are:
- Kraken has never been hacked and has not suffered any major security breaches or hacks, unlike other cryptocurrency exchanges.
- Kraken uses advanced cold storage and hot wallet solutions to secure user funds.
- Kraken encrypts all sensitive account information at rest at both the system and data levels. Access is strictly controlled and monitored. In addition, Kraken is ISO 27001 and SOC 2, Type 1 certified.
- Kraken offers multiple tools for users to secure their accounts, such as two-factor authentication, email confirmations, global settings lock, device and session management, and FIDO2-based authentication.
- Kraken has a team of experts committed to testing its own systems against every conceivable attack vector. It also conducts a bug bounty program to tap into the knowledge of the larger security research community.
- Kraken also allows you to stake and earn rewards on your cryptocurrency, which is a feature that distinguishes it from other exchanges. All of these advantages come at an affordable price, making Kraken a great option for both beginners and experienced traders, which is why it is one of the top performers in the market at present.
Is Kraken Safer than Coinbase?
The answer to whether Kraken is safer than Coinbase depends on how you define safety, but Kraken in general is safer for international traders. Both platforms have robust security records.
However, whereas Kraken never experienced a security breach, Coinbase faced some compromising incidents. In August 2019, Coinbase disclosed that it had accidentally stored 3,500 plaintext user passwords on a server log, exposing them to potential unauthorized access. Not only this, In 2021, Coinbase revealed that hackers had stolen cryptocurrency from at least 6,000 customers between March and May 2021 by exploiting a flaw in its SMS account recovery process. This certainly establishes Kraken as a safer crypto exchange than Coinbase in terms of security breaches.
Kraken keeps 95% of its assets in secured, air-gapped cold storage and maintains rigorous monitoring across the platform as well as various checkpoints during the registration process. Coinbase holds 98% of deposits in geographically distributed offline cold storage.
Apart from these, both Kraken and Coinbase provide the following multi-layered security safeguards to their users:
Security keys: Plug-in devices that verify your identity and generate a unique code for each login.
2FA: An extra layer of security for your withdrawals and transfers that both platforms offer.
PGP encryption: A way to protect your online communications with the exchange from getting compromised. Both platforms will help you set up PGP encryption for your emails and messages.
Authenticator apps: Apps that generate a random code for 2FA instead of SMS or email. Both companies support popular apps like Google Authenticator.
Is Kraken Safe for US Citizens?
Yes, Kraken is completely safe for US citizens to buy, sell, and trade crypto assets. It is registered with FinCEN as a Money Services Business with MSB Registration No. 31000239561651.
Moreover, Kraken’s security has never been compromised. However, although Kraken is legally compliant in most US states, it is not available in New York and Washington. For other US citizens, Kraken is a safe and secure platform that offers a variety of features and services. With the record of never having been hacked, it employs multiple security measures to protect user funds.
In contrast to other cryptocurrency exchanges that have been compromised in the past, resulting in thousands of dollars in coin losses, Kraken can preserve its image as a trustworthy cryptocurrency trading platform.
Has Kraken ever been Hacked?
Kraken has never been hacked. Kraken takes security seriously, ranking among the most secure sites. Kraken not only claims safe currency storage, with 95% of deposits maintained offline in cold storage locations throughout the world but also platform security. Its servers are placed in secure cages that are watched 24 hours a day, seven days a week, by armed guards and video monitors.
In addition to its safety precautions, Kraken encrypts all of your critical contact information at the system and data levels and does vulnerability testing on its own system on a regular basis.
Is Staking on Kraken Safe?
Yes, staking on Kraken is a safe and reliable way to earn passive income on your crypto assets that are not used for trading. Kraken offers one of the highest returns in the industry, up to 23% annually, depending on the coin and the term you choose. It also lets the user choose from over 20 different coins to stake and has been an example of providing the utmost security.
However, if you are a US citizen or resident, you cannot use Kraken as your crypto-staking platform. Staking through Kraken is not allowed in the US. Kraken has agreed to end its on-chain staking services for US clients as part of a settlement with the SEC.
