- Kraken launches its Perps trading feature this Thursday, allowing traders to speculate on a crypto’s potential price appreciation or depreciation in the future.
Kraken, one of the world’s top cryptocurrency exchanges, added perpetuals trading this Thursday. Kraken Perps is the latest in the line of new product offerings from the platform as it considers going public by 2026.
Kraken’s New Perps Trading
According to Kraken, its perpetual futures trading feature is only available in limited jurisdictions. A perpetual future allows traders to speculate or make a “high-conviction” call on future events. It is similar to a traditional futures contract for crypto, except that it has no expiration date. Holders of these financial derivative contracts can hold their positions indefinitely without any lock-in period as long as they can cover their periodic funding.
One does not need to own a specific crypto asset in Perps trading. If the trader believes the asset has a potential upside in the future, the trader can go “long” on its perpetual contract and earn if the trader is right in predicting its price uptrend. On the other hand, the trader can “short” the asset if it is likely to dip in value in the future.
Traders can increase the size of their positions anytime or pull out their money anytime. Kraken highlights, “Perps are more than just trading—they give you new ways to express your views, manage risk, and build strategy into your portfolio.”
Things to Remember When Trading Perps
While Kraken is touting the flexibility of perpetuals, it is also essential for traders to understand the risks involved. The “funding” that holders must cover is a key feature of this product and is crucial to market stability. A funding rate is a periodic payment made between traders to keep the perpetual contract’s price in line with the underlying cryptocurrency’s spot price.
When the price of the perpetual future is above the spot price, a positive funding rate is in effect, and traders with “long” positions (betting on a price increase) must pay traders with “short” positions (betting on a price decrease). Conversely, if the perpetual price is below the spot price, the funding rate is negative, and shorts pay longs. This mechanism prevents a perpetual contract’s price from deviating too far from the actual asset’s value. Funding payments are made directly between traders and are not a fee collected by the exchange.
Despite Kraken streamlining the process for perpetual trading so it could cater even to novice traders, it recommends the feature to advanced users.
Kraken’s Broader Expansion
The launch of perpetuals adds Kraken to a growing list of crypto exchanges, including Binance and Coinbase, that offer this popular, high-leverage product. The move is part of Kraken’s broader strategy to diversify its offerings and appeal to a wider range of traders as it positions itself for a potential public listing.
Kraken has also been expanding through strategic acquisitions, such as the proprietary trading platform Breakout, and the introduction of new products like tokenized stocks in the EU. These initiatives signal the company’s ambition to transform from a crypto-native exchange into a comprehensive, multi-asset trading platform.
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