Kraken vs Kucoin: Comparison

Discover the key differences between Kraken and KuCoin, renowned exchanges for cryptocurrency trading. Ideal for beginners and expert traders.

Sep 25, 2023 - 17:07
Oct 10, 2023 - 11:23
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Kraken vs Kucoin: Comparison
Reading time - 8 min

Kraken and KuCoin stand out as widely recognized exchanges, offering an ideal entry point for newcomers venturing into cryptocurrency trading, while also serving as reliable platforms for seasoned traders.

Ultimately, the decision between these two platforms comes down to personal preferences, as each trader has their unique requirements. However, for those who find themselves torn between the two options, the most effective approach to determine the better fit is by gaining a clear understanding of the key distinctions between the two.

Background:

Kraken: Kraken, headquartered in the USA, is a distinguished cryptocurrency exchange offering both a sophisticated trading platform and a user-friendly mobile application. Established in 2013, Kraken stands as one of the pioneering crypto exchanges, known for its credibility and secure methods for purchasing crypto using fiat currency. With platforms tailored for both novices and expert traders, Kraken provides straightforward trading options, margin-supported spot trading, and a platform for futures trading.

Serving over 9 million users across more than 190 countries, Kraken handles daily spot trading volumes exceeding $1 billion. Additionally, Kraken recently introduced an NFT marketplace.

KuCoin: KuCoin stands as a well-known cryptocurrency exchange, featuring an extensive list of coins and diverse trading options. Launched in the latter part of 2017, KuCoin has rapidly grown its user base, now serving over 20 million customers spread across more than 207 nations. As per their platform, a quarter of global crypto traders choose KuCoin for their trading needs.

The platform provides users with various services, including spot trading, futures, margin trading, leveraged tokens, and no-fee cryptocurrency swaps. Additionally, KuCoin offers staking benefits, opportunities to earn interest through crypto lending, and the convenience of buying cryptocurrencies using credit or debit cards. This makes KuCoin one of the most feature-rich crypto exchanges currently available.

Supported Currencies and Pairs:

Kraken: Showcases a diverse range of over 220 digital currencies, including leading names like Bitcoin, Ethereum, and Cardano, and supports transactions in various fiat currencies such as USD, EUR, and GBP.

KuCoin: Stands out with an impressive catalog of more than 800 digital currencies, ensuring a vast choice for traders, from mainstream crypto options to unique altcoins.

KuCoin vs Kraken Fees:

Deposit Fees:

Kraken: Fiat deposits may come with fees, contingent on the currency and method. For instance, depositing USD via FedWire (MVB Bank) is free, while using FedWire (Synapse) incurs a $5 charge.

KuCoin: Doesn't support direct fiat deposits. Purchasing crypto with fiat incurs a fee ranging between 3% - 5%, based on the chosen payment method. 

Trading Fees:

Kraken: Offers spot trading fees commencing at 0.16% for makers and 0.26% for takers. The possibility of lowering your trading fee is contingent upon your trading volume, as indicated in the accompanying table. Should you opt to utilize Kraken's Instant Buy/Sell feature for cryptocurrency transactions, there is a fee of 1.5% for each transaction.

Kucoin: Offers competitive trading fees beginning at 0.1%. By opting to pay fees with KCS coin (KuCoin's native token), users can avail a 20% discount, bringing the fee down to 0.08%. High-volume traders or those holding significant KCS can benefit from additional reductions through a tiered fee system. 

For those initiating crypto purchases on KuCoin with fiat, fees vary between 3% - 5%, depending on the chosen payment method. While the platform features minimal trading fees, newcomers without existing crypto holdings might face steeper costs for their initial purchases.

Withdrawal Fees:

Kraken: Allows for fiat currency withdrawals, but these withdrawals may come with fees depending on the chosen currency and withdrawal method. Regarding cryptocurrency withdrawals from your Kraken account, there is a flat fee applied to cover transaction costs, which varies depending on the specific cryptocurrency you wish to withdraw.

KuCoin: Faces significant criticism due to its lack of support for fiat withdrawals, restricting users to cryptocurrency withdrawals only. The withdrawal fee is flat and varies depending on the specific cryptocurrency you're withdrawing.

Security Measures:

Kraken: Offers extensive security precautions to protect both users' assets and personal data. They keep 95% of digital assets in secure offline cold storage, which is geographically distributed and air-gapped. Additionally, their servers are housed in secure cages, monitored around the clock by armed surveillance personnel.

Kraken's headquarters are in the United States, making it subject to regulation by FinCEN. This regulatory oversight ensures financial stability, as Kraken maintains full reserves and maintains strong banking relationships. The exchange adheres to the highest standards of legal compliance to provide a secure and trustworthy platform for users.

KuCoin: Offers security features like KYC verification and standard safety measures. However, it suffered a major hack in 2020, where hackers took over $280 million worth of cryptocurrencies from users' hot wallets. Luckily, there was an insurance fund to cover the losses, but such a large breach was worrying.

On top of standard security features like multi-factor authentication and encryption, KuCoin provides users with a separate trading password. This special password is needed for making trades or withdrawing assets and adds an extra layer of security. KuCoin also has a system to verify business wallet addresses, which helps reduce the risk of users falling for phishing scams. 

Trading Platforms:

KuCoin Trading Platform

KuCoin and Kraken are cryptocurrency exchanges that provide a range of trading options. Both exchanges support various trading types, including margin trading, leverage trading, spot trading, and copy trading. Nevertheless, distinctions exist between these two exchanges concerning the features and capabilities they provide for each trading type:

Margin trading: Allows traders to borrow funds from the exchange to increase their trading position. Both KuCoin and Kraken offer margin trading, but KuCoin has a wider range of available assets for margin trading. KuCoin also offers a lower minimum borrowing amount and a higher maximum borrowing amount compared to Kraken. In addition, KuCoin allows users to choose between isolated margin and cross-margin trading, while Kraken Pro only offers isolated margin trading.

Leverage trading: Enables traders to initiate positions with a value surpassing their account balance by utilizing borrowed funds. KuCoin provides leverage trading with a maximum leverage of up to 100x, whereas Kraken offers leverage trading with a maximum leverage of up to 5x. It's worth noting that Kraken Pro surpasses KuCoin in terms of the variety of trading pairs available for leverage trading.

Spot trading: Involves the purchase and sale of cryptocurrencies at their current market rates. Both KuCoin and Kraken facilitate spot trading for a diverse selection of cryptocurrencies. Nevertheless, Kraken provides a more extensive suite of advanced trading utilities, including market depth charts, order book depth charts, and the capability to set price alerts.

Copy trading: Enables traders to automatically replicate the trading strategies of expert investors. KuCoin provides copy trading functionality via its social trading feature, which permits users to track and mimic the trading activities of leading traders on the platform. In contrast, Kraken does not incorporate a copy trading feature.

Staking and Earn:

KuCoin Staking Service

Both KuCoin and Kraken provide staking services that enable users to earn rewards by holding specific cryptocurrencies on their respective platforms.

Here are some notable distinctions between the two:

  1. Supported Coins: KuCoin offers staking options for more than 59 coins, whereas Kraken's staking support is limited to only 19 coins, including Cardano (ADA), Cosmos (ATOM), Polkadot (DOT), and, more recently, USD Coin (USDC).
  2. Rewards: Kraken typically offers higher staking rewards compared to KuCoin. As an example, as of the current moment, the staking rewards for Polkadot on Kraken stand at approximately 12%, whereas on KuCoin, they are around 9%.
  3. Fees: Both platforms charge zero fees for staking services.

Note: Kraken doesn't allow staking for US Customers.

NFT Marketplace:

Kraken NFT Marketplace (Source: Kraken)

Kraken: The Kraken NFT Marketplace distinguishes itself by charging zero gas fees for trades, thus sparing users from the customary transaction fees often tied to NFT trading. Kraken NFT further empowers users with the ability to monitor the rarity rankings of their NFTs, providing insights into the value of their collections. Additionally, users have the flexibility to acquire NFTs using either cash or a comprehensive selection of cryptocurrencies, spanning over 185 options.

Kucoin NFT Marketplace (Source: Windvane)

KuCoin: Recently, KuCoin introduced its NFT marketplace, featuring a diverse array of digital collectibles encompassing artworks, music, and gaming assets. This platform is compatible with various blockchains, including Ethereum, Binance Smart Chain, and KuCoin Community Chain, facilitating the exchange of NFTs from different ecosystems.

KuCoin provides an easily navigable interface and imposes minimal fees for NFT transactions. Nonetheless, it's important to note that KuCoin's NFT selection remains somewhat constrained when compared to other NFT marketplaces.

Kraken vs KuCoin Features:

The functions of a cryptocurrency exchange can play a big role in choosing where to trade. Let's highlight some notable features of KuCoin and Kraken. Since both have a lot of features, we'll only mention a few that are especially interesting.

Kucoin:

Using KuCoin, you have the opportunity to increase your cryptocurrency investment even if it's just resting in your exchange account. One method to generate interest from your cryptocurrency is by purchasing and holding KuCoin's native coin, KCS. Once you have 6 KCS or more in your account, you will start receiving daily interest, which is estimated at an annual rate of approximately 22%.

KuCoin also provides free trading bots on their platform, which are user-friendly and simplifies optimizing your trading approach. You have the flexibility to determine the rules your bot should adhere to for executing automated trades, even when you're not actively monitoring the markets with your devices turned off. Additionally, KuCoin showcases the most successful bots used by other traders, offering the option to replicate their bot settings to potentially enhance your own trading outcomes.

KuCoin Trading Bots

You also have the opportunity to generate interest from your cryptocurrency by lending it to KuCoin users. You get to pick the specific coin you want to lend out (with support for 160 different coins) and decide the lending term (options include 7, 14, or 28 days). Following that, you select the daily interest rate you'd like to earn. Keep in mind that opting for a higher interest rate can result in greater returns for you, but it might reduce the likelihood of someone borrowing from you, especially if lower-rate options are available to them.

KuCoin Lending Platform

Kraken:

Kraken provides the option for crypto traders to engage in forex trading without the need for a separate account. Kraken offers competitive trading fees, a professional trading interface, and remarkably low minimum order sizes, starting at just 10 units of the base currency. You can access a selection of 9 forex trading pairs, which are listed below for your reference.

Kraken Forex Trading Pairs 

Kraken also provides the opportunity to generate interest from your cryptocurrency holdings through staking. Interestingly, you can even stake traditional fiat currencies like USD and EUR, which is not commonly offered by cryptocurrency exchanges. Rewards are distributed twice a week, and you have the option to increase them by reinvesting future rewards. Here are some of the current staking options available on Kraken.

Half of Kraken's Staking Options

Customer Support and Service:

Kraken: Kraken provides top-tier customer support services, ensuring prompt responses to inquiries, often within minutes if not seconds. Additionally, they offer phone support, allowing users to directly communicate their issues to the support team, who are readily available to provide assistance, resolve problems, or address any questions you may have.

KuCoin: It garners a generally unfavorable reception from its user base. Many critical reviews highlight issues related to customer support, challenges with the withdrawal and deposit procedures, and allegations of market manipulation. Additionally, there are disturbing reports of users claiming that their assets vanished from their accounts unexpectedly. These concerns are particularly troubling.

However, it's important to note that amidst the negative feedback, a few reviewers did express positive sentiments regarding KuCoin's advantages, such as its low fee structure and extensive range of available cryptocurrencies.

KuCoin or Kraken?

To sum it up, both KuCoin and Kraken stand as reputable and dependable cryptocurrency exchanges, each presenting a range of features and services for their users. KuCoin, being relatively newer, features an extensive list of alternative cryptocurrencies and maintains competitive trading fees. In contrast, Kraken, with its established presence, offers advanced trading tools and robust security features.

If your primary focus is diversifying your cryptocurrency portfolio with a wide range of altcoins while minimizing trading costs, then KuCoin may be the preferable choice. On the other hand, if your interests lean more towards leveraging advanced trading tools and prioritizing security measures, then Kraken might be the superior option.

Philip Bohmer Philip is a seasoned journalist that brings clarity to the complex world of cryptocurrencies through his articulate and insightful articles. His passion for blockchain technology fuels his writing, making him a trusted voice in the rapidly evolving digital currency landscape.