How do you trade crypto at Kraken exchange? This guide will go step by step into the buying journey at Kraken.
Founded in 2011, Kraken is a US-based cryptocurrency trading platform available in 48 US states and 176 countries. Also, because of its safe reputation, the exchange data is being used as a ticker(BTC/USD) on the Bloomberg terminal.
The Kraken platform specializes in offering Bitcoin trading services for the beginner as well as the professional trader. Besides trading in digital assets, it’s also possible to store your crypto in custodian wallets, crypto lending services, and staking cryptocurrencies.
Spot trading cryptocurrencies gives you a fee of 0.16% and this value decreases when USD volume rises. Additionally, margin trading is even cheaper where the rate is set to 0.01%.
This guide is going to show you how to trade your first cryptocurrency, via one of the world’s most popular exchanges, Kraken.
How to start Trading Crypto at Kraken: Quicktake
In general, buying cryptocurrency at Kraken is a straightforward process, however, first-timers must do some extra necessary steps before they can start using the platform.
In short, below is the buying process for cryptocurrencies at Kraken:
- Register at Kraken for free by email or mobile phone
- Verify your account(KYC)
- Deposit money by bank account
- Or: Send crypto(BTC, ETH, DOT, or any other) to Kraken
- Trade crypto at Kraken platform
Open an Account at Kraken and start Depositing
How to open an account at Kraken? At this stage, I’ll explain in more detail what is needed for the beginner to open an account and deposit money or crypto.
1. Register for an Account at Kraken
The first step will be to register for an account at Kraken. If you haven’t already, register for an account. The process can usually be completed very quickly.
It just takes a few simple steps in order for users to be able to start trading digital currencies on the platform. However, if the goal is to have higher limits, the process needs verification and can take some more time to be completed.
2. Verify your account
First, you have to confirm your email address by clicking on the link that has been sent to you.
At this stage, you will be able to log in to the platform, but you aren’t allowed to trade because of the KYC which is mandatory.
For cryptocurrency traders, there are three levels on the Kraken platform: Starter, Intermediate, and Pro. In the first place, there is Starter which allows you to deposit cryptocurrency only. Additionally, you can only withdraw a max of $5k/day and trade crypto pairs only.
Secondly, if you already have any trading experience want to trade in bigger volumes then it’s up to you if you choose Intermediate or Pro. Intermediate takes a few minutes for KYC and Pro can last longer: a few days.
3. Deposit Money or Crypto
At this stage, you are ready to use the platform but need to deposit first. Money transfers can be done at Kraken in the following fiat currencies: USD, EUR, GBP, AUD, CHF, and JPY. For example, money deposits with USD are possible in combination with Synapse.
Another option that answers the question ‘how to open an account at Kraken’ is by just depositing crypto(BTC, ETH, or any other). Moreover, this is the quickest and cheapest way to start using the platform in minutes.
In other words, if you already have some crypto in a local wallet or at another exchange, just sent it over to Kraken and you can start using Kraken right away!
Step By Step Guide: How to Trade Crypto at Kraken
Next in this beginner’s guide to trading crypto on Kraken, I will cover the basics of using the trading interface on this platform. Remember that there are several other options available(like advanced orders or margin trading) however, as a starter we will just focus on buying or selling crypto for fiat currency.
1. Select currency pair
First, you’ll need to know what assets you would like to exchange, for example buying Bitcoin with your USD, or selling Ethereum (ETH) for euros.
After you know which pairs you’ll be trading, you can select them from the ticker/quote bar near the top left corner while viewing the ‘Trade‘ tab.
Let’s assume you want to buy Bitcoin with USD fiat currency. Additionally, find the trading pair on the platform works like this: The first currency in a pair represents the base currency, while the second in a pair represents the quote currency.
In this case, buying Bitcoin with USD would give the BTC/USD trading pair. How to select this?
First, select the Ticker/Pair just below ‘Market‘
A new screen appears that asks you for selecting the proper trading pair. You want to buy with USD so you have to select the USD tab first:
2. Setting up the order(BUY)
Just to rephrase, in a buy order, you pay with the quote currency(USD) and receive the base currency(BTC). Above you selected the trading pair so now it’s time to set up the order.
At this moment you have redirected to the ‘New order’ screen to set up a ‘Simple‘ order:
Here you’ll see three text boxes and the option to use a market or limit order. Next, before you start entering values into these boxes, knowing how a market or limit order works is necessary.
A market order is meant for immediate execution, as it will match with limit orders that are already available on Kraken order books. In other words, by executing a market order you take 1(or more) order(s) from the available order book.
Also, market orders will always incur a slightly higher fee known as a taker fee. With market orders, you can only input the volume you would like to buy or sell and not the price.
Limit orders will execute at the price you’ve set or better, once the market reaches your limit price. They can be subject to maker or taker fees depending on when it executes.
For example, you entered a buying price of $45000 into the order book while BTC is trading at $45500. Once the BTC price reaches $45000 the order will be executed at maker fees.
On the other hand, if a matching order already exists(at $45000), then it’s executed immediately, where the taker fees will occur.
3. Submit the Order
Once you’ve decided if you’re looking for a market or limit order, you fill in the required data and continue.
You can do a final check on the order screen and once done you submit the big green button with ‘Buy BTC with USD‘. Next, an order confirmation screen appears where you can double-check.
⚠️Pay attention: This screen can be avoided if the ‘Skip order confirmations‘ box is checked.
4. Wait for Execution
At this stage, your buying journey on trading crypto at Kraken is coming to an end. Moreover, you just need to wait for the order to be completed. Remember that completion can occur in two ways:
Immediately, where a market order was selected and your balance will change as well. Also, funds will be available right away for new trades or to withdraw.
Unfilled orders occur when a limit order was selected and you need a little patience for this order to be executed. In addition, if it takes too long or you need the funds, you can cancel the order at any time.
Finally, below on the screen, you can see the status of the orders these are ‘New & Open orders‘ or ‘Closed orders‘.
…That’s it! At this point, you just traded your first USD for BTC on Kraken which is one of the most popular trading engines in the world. Happy trading 😁
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