Major crypto exchange Kraken is diversifying beyond digital assets, expanding its derivative offerings into the traditional foreign exchange market. The platform recently unveiled forex perpetual futures (FX perps), signaling a significant strategic move.
Initially featuring the highly traded EUR/USD and GBP/USD pairs, these new derivative contracts allow traders to speculate on currency price movements without an expiration date. Clients can utilize leverage up to 20x on these popular pairs.
These FX perpetual contracts track DxFeed’s Composite Forex Index, offering a benchmark for the derivatives. Trading is accessible around the clock via the Kraken Pro interface, although the index prices themselves only update during standard forex market hours.
This launch leverages Kraken’s established presence in FX spot trading within the blockchain ecosystem. Alexia Theodorou, Kraken’s Head of Derivatives, highlighted that introducing FX perps capitalizes on their market position, providing clients a potent new tool and broadening the exchange’s reach across asset classes.
In 2024 alone, Kraken facilitated $5.4 billion in FX spot trades, with EUR/USD and GBP/USD contributing $3.5 billion to this volume. The new FX perps aim for precise strategy execution and continuous market access, incorporating protective measures like zero funding fees during stale pricing periods and price collars to prevent trades executing more than 4% away from the index price.
This foray into FX derivatives follows Kraken’s recent addition of commission-free stock and ETF trading, underscoring its ambition to bridge the gap between crypto and traditional financial markets. The exchange plans to add more FX pairs and expand availability in the near future.