Is Kraken Safe: Should You Buy Crypto on Kraken?

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Cryptocurrency investors face a critical decision when choosing where to store and trade their digital assets: security. With so many exchanges available, it’s essential to evaluate platforms not just by their features or fees, but by how well they protect your funds and personal information. Among the most prominent names in the industry, Kraken stands out as one of the longest-standing and most widely used crypto exchanges globally.

But the central question remains: Is Kraken safe? This in-depth review explores Kraken’s security protocols, regulatory status, insurance policies, historical incidents, and customer support to help you make an informed decision about whether Kraken is the right platform for buying, trading, or holding cryptocurrency.

About Kraken: A Trusted Name Since 2011

Founded in 2011 by Jesse Powell, Thanh Luu, and Michael Gronager, Kraken (operated under Payward, Inc.) emerged during the early days of Bitcoin. Powell, who had consulted for the now-infamous Mt. Gox exchange, foresaw its downfall and built Kraken as a more secure alternative.

Over the years, Kraken has cemented its reputation through innovation and compliance milestones:

As of 2025, Kraken serves over 9 million users across 190 countries and holds a valuation of $5.5 billion—solidifying its place among the top-tier cryptocurrency exchanges.

👉 Discover how easy it is to start trading on a trusted global platform.

Is Kraken Safe? Evaluating Security Measures

Yes—Kraken is considered a safe cryptocurrency exchange, especially when users take full advantage of its robust security tools. While no system is entirely immune to risk, Kraken has implemented multiple layers of protection designed to safeguard user accounts and assets.

Here’s how Kraken ensures your safety:

Two-Factor Authentication (2FA)

Kraken mandates strong authentication practices. All users are encouraged to enable two-factor authentication (2FA), which requires a password plus a second verification method such as:

Additionally, Kraken offers Step-up 2FA, an advanced feature that re-authenticates users before allowing sensitive actions like changing 2FA settings or initiating large withdrawals.

Master Key Protection

To prevent unauthorized account recovery attempts, Kraken allows users to set up a Master Key—a separate credential required for password resets or critical account changes. The platform strongly recommends using a hardware security key (like YubiKey) for this purpose, as it provides phishing-resistant protection.

Using a different method for your Master Key than your standard 2FA adds an extra layer of defense against targeted attacks.

Passkeys for Phishing Resistance

Kraken supports passkeys, a modern login standard developed by the FIDO Alliance. Unlike passwords or one-time codes, passkeys are unique to each website and cannot be reused or intercepted via phishing. They rely on biometrics or hardware keys and eliminate the risk of fake login pages stealing your credentials.

Enabling passkeys significantly enhances your account’s resistance to social engineering attacks.

Global Settings Lock (GSL)

The Global Settings Lock (GSL) is one of Kraken’s most powerful security features. Once activated, GSL prevents any changes to key account settings—including withdrawal addresses, email, 2FA, and Master Key—without first disabling the lock through a time-delayed process.

This delay gives users time to detect and stop unauthorized access attempts. Kraken advises keeping GSL enabled at all times and not linking it to the Master Key for maximum protection.

Are Kraken Deposits Insured?

Unlike traditional banks, cryptocurrency exchanges are not covered by FDIC insurance, and Kraken is no exception. This means your crypto holdings on Kraken are not insured by the U.S. government.

More notably, Kraken does not carry private crime insurance—a feature offered by competitors like Coinbase and Binance that covers losses from exchange-side hacks or internal breaches. If Kraken suffers a systemic breach (though none have occurred to date beyond the 2024 incident), user funds may not be reimbursed.

This underscores the importance of self-custody best practices:

Has Kraken Ever Been Hacked?

Kraken has maintained an impressive security record since 2011. However, in early 2024, a vulnerability was exploited following a platform update, resulting in approximately $3 million in stolen funds. The attacker was not a white-hat researcher but instead profited from the exploit without disclosing the flaw.

Kraken acted swiftly to patch the issue and enhance monitoring systems. Notably, this remains the first and only major security incident in Kraken’s 13-year history—an achievement few other exchanges can claim.

Compare this with repeated breaches at larger platforms like Binance and Coinbase, and Kraken’s track record appears strong—though vigilance is still required from users.

👉 Secure your digital assets with advanced trading tools and deep liquidity.

Regulatory Compliance: Navigating Legal Challenges

Kraken operates in a complex regulatory environment. In 2022, the U.S. Securities and Exchange Commission (SEC) sued Kraken over its staking program, alleging it offered unregistered securities. The case was settled in 2023, with Kraken agreeing to pay a fine and temporarily pausing staking services.

A second lawsuit filed in 2023 accused Kraken of functioning as an unregistered securities exchange. While the legal battle continues, experts note that these actions target Kraken’s business model—not user funds. Your deposits and trades remain unaffected by ongoing litigation.

Despite these challenges, Kraken holds licenses in multiple jurisdictions and continues to prioritize compliance—a sign of long-term sustainability in the evolving crypto landscape.

Customer Support: Responsive and Secure

If you encounter an issue, Kraken offers several support channels:

Importantly, Kraken will never ask for your password, 2FA code, wallet address, or Master Key. Any request for such information is a scam.

Support quality is generally rated highly, especially for urgent security-related inquiries.

Final Verdict: Is Kraken Safe to Use?

Yes—Kraken is safe, particularly for users who actively employ its full suite of security tools. Its long-standing reputation, proactive security design, and commitment to compliance make it one of the most trustworthy exchanges available.

However, safety isn’t guaranteed—it depends heavily on your behavior:

For those willing to follow best practices, Kraken offers a secure environment for trading over 200 cryptocurrencies, futures contracts, NFTs, and soon, traditional financial assets.

👉 Start trading with confidence on a platform built for security and scale.

Frequently Asked Questions (FAQs)

How can I fund my Kraken account?
You can deposit funds via Visa or Mastercard debit/credit cards, ACH transfers, wire transfers, or by transferring crypto from another wallet. Some methods may require up to 72 hours for processing.

What documents are needed to verify my account?
Kraken requires:

Is Kraken available in all U.S. states?
No. Kraken operates in 48 states plus D.C., but is not available in New York or Washington due to regulatory restrictions.

What is the minimum trade amount on Kraken?
Kraken supports fractional trading. You can buy as little as $1 worth of Bitcoin or other supported cryptocurrencies.

Is Kraken suitable for beginners?
Kraken is better suited for intermediate to advanced users due to its complex fee structure and professional-grade tools. Beginners should spend time learning through Kraken’s educational resources before trading actively.

Does Kraken charge high fees?
Kraken is free to join. Trading fees vary based on order type and volume. Simple buys include both an exchange fee and spread cost. Active traders benefit from lower tiered rates.