Kraken girds for more rivals and deals as crypto heats up 

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 euphoriaFollowing 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, KrakenLed 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 optionsKraken, 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.K