Overview of the Acquisition
Kraken has recently acquired Small Exchange, a CFTC-regulated Designated Contract Market, for $100 million. This significant move marks a new era for Kraken, enabling the establishment of a fully U.S.-based derivatives trading platform.
Strategic Benefits of the Acquisition
This acquisition sets the stage for Kraken to create a comprehensive trading environment that integrates spot, futures, and margin products under one regulated liquidity system. Arjun Sethi, Kraken’s co-CEO, stated, “Under CFTC oversight, Kraken can now integrate clearing, risk, and matching into one environment that meets the same standards as the largest exchanges in the world.”
Expanding Presence in the U.S. Derivatives Market
Kraken’s acquisition strategy is part of its broader efforts to penetrate the U.S. derivatives segment, following its earlier purchase of NinjaTrader, a well-known U.S. futures platform. This expansion comes at a time when the U.S. crypto derivatives market is witnessing substantial growth, largely fueled by increased institutional participation and an expanding array of regulated product offerings.
Growth of Cryptocurrency in the Derivatives Space
According to data from the CME Group, the leading U.S. derivatives marketplace, the average daily volume of cryptocurrency derivatives surged by 136% to 190,000 contracts in the second quarter of this year compared to the same period last year. This upward trend underscores the growing acceptance and adoption of digital assets within mainstream finance.
Conclusion
As Kraken strengthens its foothold in the U.S. derivatives market through strategic acquisitions, the landscape for cryptocurrency payments continues to evolve. GOPayments stands poised to support businesses seeking to navigate this new territory, offering seamless options for accepting Bitcoin payments and other cryptocurrency transactions.