Kraken Gets Green Light for Advanced Trading in EU
[[Kraken]], the popular crypto exchange, has just scored a big win in the EU. They’ve snagged a Markets in Financial Instruments Directive (MiFID) licence, which means they can now offer fancy trading options like derivatives to serious traders across the EU. This is big
news
for the cryptomarket
, especially as Europe is a hotbed for this type of trading. Kraken plans to roll out these new services in the coming months. This is a major step forward for Kraken, after facing some challenges recently.How Kraken Got the Licence
Kraken got this licence by buying an investment firm called Cypriot. After this deal, the Cyprus Securities and Exchange Commission (CySEC) gave them the thumbs up to operate as a licensed crypto entity in the EU. Kraken is super excited about this because Europe is a big
market
for crypto derivatives trading. They believe offering these advanced products will attract experienced traders looking for more ways to grow their money. They’ll be able to use different currencies as collateral, making trading more flexible.Recent Setbacks for Kraken
Getting this licence is a breath of fresh air for Kraken. They’ve had a rough patch lately. In December 2023, they were blocked in India because they hadn’t registered with the Financial Intelligence Unit. Last year, they were fined $5.1 million (roughly Rs. 43 crores) in Australia. The Australian Securities and Investment Commission (ASIC) said Kraken was offering credit services without the right paperwork, putting people at risk. They also shut down their NFT platform last year because the NFT
market
wasn’t doing so well. They decided to focus on other, more profitable things. This shows how themarket
can change quickly and how businesses need to adapt to stay on top.What is Derivatives Trading?
Derivatives trading is like betting on the future price of something, like Bitcoin, without actually owning it. It’s considered risky, but the potential rewards may be high. There are three main types: futures, options, and swaps. Futures are like making a promise to buy or sell something at a set price on a future date. Options give you the choice to buy or sell, while swaps involve exchanging assets based on how they perform. It’s all a bit complex, but it’s a big part of how many people trade in the crypto world.
Benefits and Risks of Derivatives Trading
Derivatives trading can be attractive because it lets you get involved with crypto without buying it directly. This makes the
market
more liquid and gives traders more options. However, it’s risky because prices can change quickly. There are also fees involved that can eat into your profits. It’s important to do your research and understand the risks before getting involved with this type of trading.About Kraken
Kraken was founded in 2011 and has over 13 million customers around the