Bitcoin Exchange Kraken Raises $5 Million in Latest Funding Round

Kraken announced a new Series A funding round on Tuesday led by Hummingbird Ventures.

AccessTimeIconMar 25, 2014 at 8:53 p.m. UTC
Updated Sep 3, 2021 at 11:06 a.m. UTC

Presented By Icon

Election 2024 coverage presented by

Stand with crypto

Payward, Inc., the owner of US-based digital currency exchange Kraken, announced on 25th March that it has raised $5m in new capital as part of a Series A fundraising round.

  • Bitcoin Mining in the U.S. Will Become 'a Lot More Decentralized': Core Scientific CEO
    13:18
    Bitcoin Mining in the U.S. Will Become 'a Lot More Decentralized': Core Scientific CEO
  • Binance to Discontinue Its Nigerian Naira Services After Government Scrutiny
    05:10
    Binance to Discontinue Its Nigerian Naira Services After Government Scrutiny
  • The first video of the year 2024
    04:07
    The first video of the year 2024
  • The last regression video of the year 3.67.0
    40:07
    The last regression video of the year 3.67.0
  • , first launched in September 2013, allows users to buy and sell bitcoin, namecoin, dogecoin and Ripple, among other digital currencies.

    The round was led by Hummingbird Ventures, an early-phase venture capital firm that has invested in digital properties like Dubai-based price comparison platform Souqalmal.com and object-based software defined storage service provider Amplidata in recent months.

    The funding will be used by Payward to strengthen Kraken's position in the global digital currency market.

    Conservative approach

    Jesse Powell, CEO at Kraken, told CoinDesk that the company plans to deploy its new funding to meet key development and regulatory needs.

    "We're taking a very conservative approach to [regulation and compliance], and this funding allows us to continue to be conservative and to be compliant to the law, and we think this is just the best approach in the long term."

    The news comes as the US government issued new guidance on digital currencies. The Internal Revenue Service announced on 25th March that it would treat them like property, making them subject to capital gains tax treatment.

    Given the increased burden of compliance requirements, Kraken is taking its approach to these matters seriously.

    "We're really excited, we've been putting the round together for a long time, the funding is going to go to development, regulatory stuff, getting all the licenses in the United States and around the world. A lot of it is going to go into legal."

    Pressure on exchanges

    Earlier this week, Kraken announced that it had passed a verifiable proof of reserves audit. The test was carried out in order to bolster confidence in the exchange's ability to meet customer balance demands.

    During the interview, Powell went on to speculate that some exchanges may face greater scrutiny in the months ahead.

    "This has been more of an issue lately with exchanges like Gox going down. We may see an increasingly greater heat on these unlicensed money transmitters and these exchanges that are a little more shady."

    In the wake of the collapse of Mt. Gox, exchanges have faced financial difficulties. China-based Vircurex froze withdrawals this week, in just the latest in a string of high-profile bitcoin exchange issues.

    Disclosure

    Please note that our privacy policy, terms of use, cookies, and do not sell my personal information have been updated.

    CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. CoinDesk has adopted a set of principles aimed at ensuring the integrity, editorial independence and freedom from bias of its publications. CoinDesk is part of the Bullish group, which owns and invests in digital asset businesses and digital assets. CoinDesk employees, including journalists, may receive Bullish group equity-based compensation. Bullish was incubated by technology investor Block.one.


    Learn more about Consensus 2024, CoinDesk's longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.