Key Notes
- Kraken obtained a MiFID license via the acquisition of a Cypriot investment firm earlier this year.
- The license will grant Kraken more room to expand its crypto derivatives offering in the EU.
- Derivatives are now a major part of Kraken’s total trading and global crypto markets.
Digital asset exchange giant Kraken has taken another step in its global strategy. According to the exchange, it has secured regulatory approval to offer crypto derivatives in the European Union. This follows a recently acquired license in Cyprus.
Kraken Gains Ground in the European Market
According to the exchange’s announcement, Kraken has received the green light to expand its crypto derivatives services to users across the European Economic Area. This move became possible after the platform acquired a Cypriot investment firm earlier this year.
The acquisition granted Kraken a Markets in Financial Instruments Directive (MiFID) license. This will allow the cryptocurrency entity to serve retail and institutional investors in the EU. The permit was granted by the Cyprus Securities and Exchange Commission (CySEC), marking a notable expansion for the exchange across continents.
It is worth noting that this latest update is part of Kraken’s recent growth strategy. In a recent report, Coinspeaker noted that Kraken now offers commission-free access to US-listed stocks and ETFs for clients in ten American states.
Again, this recent update follows a similar rollout in the United Kingdom. The UK officials granted the exchange access to start offering regulated derivatives trading under the supervision of the Financial Conduct Authority.
Now, users in EU countries, including France, Germany, the Netherlands, and others, will gain access to Kraken’s existing set of perpetual and fixed maturity futures contracts. According to Kraken’s Head of Exchange, Shannon Kurtas, these contracts already account for significant trading volume, estimated to range between $1 billion and $2 billion daily.
Kurtas stated that the focus is not on launching new contracts. However, they are working to improve existing products that are already well established with strong liquidity and mature markets.
She mentioned that the necessary infrastructure is already in place. This allows for lower execution costs and greater efficiency for users moving funds in and out of the system.
Derivative Trading Now a Core Business for Kraken Exchange
Crypto derivatives have become a major part of Kraken’s global offering. The firm estimates that derivatives now make up much of its overall trading activity. On a broader scale, global crypto markets have seen derivatives dominate, accounting for up to 75% of total volume.
Since the US SEC dropped its lawsuit, Kraken has expanded. Its growth includes acquiring Crypto Facilities, a UK-based futures platform, and NinjaTrader, a US derivatives platform. These moves show Kraken’s aim to lead regulated crypto markets.
The crypto exchange recently introduced its Embed application in Europe. This allows neobanks and fintech platforms to offer their customers both spot and derivatives trading. Larger crypto firms increasingly turn to agile jurisdictions such as Cyprus and Malta. These locations help them gain regulatory approval more quickly.
It is essential to add that the EU is one of the fastest-growing areas for digital assets. Kraken’s move places it in a strong position to meet the region’s increasing demand for regulated and efficient derivatives trading.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Benjamin Godfrey is a blockchain enthusiast and journalist who relishes writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desire to educate people about cryptocurrencies inspires his contributions to renowned blockchain media and sites.
