Just two weeks ago, US crypto exchange Kraken slashed 400 employees from its workforce in a move the firm characterised as an “organisational discipline” decision.
Now Donald Trump’s election win could be just what the exchange needs to get out of its funk.
“The US election outcome marks a significant turning point for crypto policy,” Jonathan Jachym, Kraken’s global head of policy, told DL News.
He added that Kraken is looking forward to working with the Trump administration and the new Congress to advance policy.
By many accounts, Trump’s election victory signals a more proactive approach to crypto regulation in the US over the next four years.
Clearer crypto rules under the Trump administration should make it more palatable for US crypto firms to try new things by removing the fear that they could get slapped with legal action from regulators like the Securities and Exchange Commission.
Hit hard
Kraken has been hit hard during the Biden administration’s crypto crackdown.
In February 2023, the exchange settled an SEC suit for $30 million, and was forced to stop offering its US users the ability to stake their crypto assets.
Then in November that year, an SEC complaint charged Kraken with operating as an unregistered securities exchange. The agency is embroiled in similar suits against rival exchanges Coinbase and Crypto.com.
Now, mere days after the SEC filed to dismiss some of Kraken’s defences against the suit, the exchange is hoping to make up for lost time.
‘Bolder, faster, leaner’
“I hope that the clarity will be permissive enough to allow us to continue to innovate,” Kraken’s global head of asset growth and management Mark Greenberg told DL News.
“Bolder, faster, leaner is the name of the game for the year ahead,” the executive said, adding that he sees “immense opportunities” in growing both retail and institutional customers.
In recent months, Kraken has followed top US exchange Coinbase in several products, such as a new DeFi-compatible Bitcoin version, and announcing its own Ethereum layer 2 blockchain called Ink, which is built using the same infrastructure as Coinbase’s Base blockchain.
It also followed Crypto.com’s July move by launching EigenLayer restaking last month, a way for Ether holders on the exchange to earn extra yield.
From the outside, onlookers might be forgiven for thinking that Kraken was shadowing more dominant exchanges as it fights to compete in the increasingly crowded crypto exchange market.
Recent struggles
Kraken, like other US-based exchanges, has struggled in recent years.
Despite Bitcoin trading at an all-time high, the exchange’s trading volumes are still well below their 2021 peak.
The way Greenberg tells it, the similar launches are just part of Kraken’s plan to leave no stone unturned as part of its new strategy to win over customers.
“There are lots of good ideas that others will get to first,” Greenberg said when asked about the similar products in recent months.
“We are testing and learning the market,” he said. “We don’t really go, ‘oh shoot, Coinbase or x organisation got into this therefore we can’t.’”
And there are good reasons to follow Coinbase, at least in launching a blockchain.
By most accounts, Base is a huge success. In just over a year, it has become the top layer 2 as measured by DeFi deposits, and makes Coinbase millions of dollars in profit every month.
Kraken will be hoping to replicate this success.
Still, Greenberg was tight-lipped about how exactly Kraken plans to do this.
“All I’ll say is Ink is going to be an incubator of crazy new ideas in the space,” he said.
Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.
