Kraken launches institutional arm aiming to cash in on Bitcoin ETFs

Martin Young5 hours agoKraken launches institutional arm aiming to cash in on Bitcoin ETFsThe crypto exchange launched a new institutional-focused brand, angling for more clients after the U.S. approved spot Bitcoin ETFs.1741 Total views6 Total sharesListen to article 0:00NewsOwn this piece of crypto historyCollect this article as NFTJoin us on social networksCrypto exchange Kraken has launched a new division to offer dedicated services to institutions as it angles for a piece of the spot Bitcoin (BTC) exchange-traded fund (ETF) pie. 

Kraken announced its new institutional brand on Feb. 27 that folds in its existing institutional offerings of spot and over-the-counter trading along with crypto staking — for those outside the United States — and is aiming it toward asset managers, hedge funds and high-net-worth individuals.

Staked co-founder Tim Ogilvie, who joined Kraken when it acquired his firm in December 2021, will head Kraken Institutional and said in a statement that “institutional adoption of crypto is growing rapidly.”

“The recent ETF approval has spurred broader institutional demand,” Ogilvie added.

The new nine Bitcoin ETFs have seen an aggregate inflow of $6 billion since their launch in January — an average daily inflow of $196 million; they also recently hit a new daily volume record of $2.4 billion.

Grayscale’s ETF has seen billions in outflows, but other funds have offset the selling with their inflows, with BlackRock’s and Fidelity’s ETFs leading the pack.

Coinbase is the custodian for eight of the 10 newly launched Bitcoin ETFs, leading some analysts to predict strong earnings for the firm in the year ahead. Kraken could now also be angling for a slice of that action.

In a blog post on Feb. 27, Ogilvie wrote that Kraken Institutional will launch a “qualified custody” service backed by Kraken Financial, a Wyoming-chartered Special Purpose Depository Institution.Kraken Institutional is open for business! Excited to help our partners grow their crypto businesses! https://t.co/eV5zU3nR5v— Tim Ogilvie (@Tim_Ogilvie) February 27, 2024

Related:Bitcoin ETF to trigger massive demand from institutions, EY says

Kraken Institutional competes directly with Coinbase Institutional and Coinbase Prime, which launched in 2021 to cater for institutional investors.

It also goes up against Binance Institutional, which launched in mid-2022 and offers customized solutions for institutional users such as asset managers, brokers, hedge funds, family offices, liquidity providers and proprietary trading firms.

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