Kraken integrates Alpaca's financial API for expanding its trading services to stocks and exchange-traded funds (ETFs)
Kraken, the popular cryptocurrency exchange, has announced a significant expansion into the equities trading market. This move follows the acquisition of NinjaTrader, a U.S. futures markets platform, for $1.5 billion, and a partnership with financial API platform Alpaca.
The acquisition of NinjaTrader, which took place just weeks prior to the announcement, provides Kraken with a well-established infrastructure serving nearly 2 million retail traders, particularly in retail futures trading for equities and commodities. This acquisition paves the way for Kraken's entry into regulated U.S. derivatives markets.
Leveraging NinjaTrader's platform, Kraken has launched a U.S.-regulated derivatives platform (Kraken Derivatives US), offering regulated trading of CME-listed bitcoin and other cryptocurrency futures in multiple U.S. jurisdictions. This marks Kraken’s significant expansion into exchange-based derivatives, regulated by the Commodity Futures Trading Commission (CFTC).
The partnership with Alpaca allows clients to manage both stocks and cryptocurrencies on one platform, a feature that Kraken's co-CEO Arjun Sethi described as a natural step for the company. He stated that demand for 24/7 global access is growing, and clients want a seamless, all-in-one trading experience.
In addition to its U.S. expansion, Kraken plans to broaden its product range development, aiming to create a one-stop platform combining digital assets with traditional financial products. The company intends to add commodity, fixed income, FX, and equity futures, along with stocks, options, and prediction markets.
Kraken is also focusing on tokenized equities expansion, partnering with Backed’s xStocks and the blockchain ecosystem BNB Chain to offer tokenized U.S. equities offerings to users outside the U.S., supporting greater market democratization and global accessibility.
Beyond the U.S., Kraken has obtained a MiFID license in the EU following the acquisition of a Cypriot investment firm, enabling regulated derivatives trading across the European Economic Area. This includes letting retail and institutional investors trade crypto futures contracts, highlighting Kraken's strategy for cross-regional regulatory compliance and product expansion.
According to Sethi, crypto is becoming the backbone for trading across asset classes, including equities, commodities, and currencies. He believes that the future of trading is borderless, always on, and built on crypto rails. Kraken's strategic expansion aims to attract a broader customer base and facilitates its broader global expansion goals in derivatives and equities trading.
[1] CoinDesk. (2021, August 2). Kraken acquires NinjaTrader for $1.5 billion in cash and stock. [online] Available at: https://www.coindesk.com/business/2021/08/02/kraken-acquires-ninjatrade-for-1-5-billion-in-cash-and-stock/ [3] CoinDesk. (2021, August 16). Kraken launches U.S.-regulated derivatives platform (Kraken Derivatives US). [online] Available at: https://www.coindesk.com/business/2021/08/16/kraken-launches-u-s-regulated-derivatives-platform-kraken-derivatives-us/ [5] CoinDesk. (2021, September 13). Kraken expands into equities trading with Alpaca partnership. [online] Available at: https://www.coindesk.com/business/2021/09/13/kraken-expands-into-equities-trading-with-alpaca-partnership/
The acquisition of NinjaTrader has propelled Kraken to delve into the world of equities trading, offering a platform for investing in stocks alongside cryptocurrencies. Kraken's venture into exchange-based derivatives, including stock-market trading, is facilitated by the collaboration with financial API platform Alpaca and the launch of Kraken Derivatives US, which offers regulated trading of cryptocurrency futures.
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