Poloniex vs Kraken Crypto Exchange Comparison
Making Crypto Simple
Competitiveness is what drives the global economy, and this ongoing pressure to improve keeps every industry in perpetual motion. Companies of all types constantly strive to outperform the competition. But, in my opinion, nowhere is this urge more prominent than in the cryptocurrency sector, which is at the forefront of financial innovation and holds the key to a prosperous future.
As a result, cryptocurrency investors face a more complex decision-making process than ever before as the number and diversity of cryptocurrency exchanges grow daily. Among them, Poloniex and Kraken are some of the first and most trusted of the many trading platforms that are available today.
In this article, I’ll compare these two veteran exchanges established in the USA so that you can make an informed decision about which cryptocurrency exchange is the most appropriate for your crypto-investing purposes. Continue reading.
- User-friendly and regulated exchange;
- No fee for making a cryptocurrency deposit and only a modest withdrawal fee;
- Some of the lowest fees in the industry;
- Supports margin trading with leverage of up to 2.5x;
- Has a safety-net insurance pool;
- Enables API integrations;
- Multilingual assistance to clients in more than a hundred countries;
- Supports more than 350 digital currencies;
- Suitable for advanced traders.
- Expensive Simplex fees for fiat payments;
- Suffered two security breaches;
- Doesn’t provide a demo account;
- No client phone support;
- Not available for residents of the USA.
- One of the safest platforms in the industry;
- Never had a security breach;
- Suitable for beginners and experienced traders;
- User-friendly, 24/7 phone and email support service;
- Provides staking option with an annual dividend of up to 23%.
- The Instant Buy option is overpriced;
- A small number of cryptocurrencies compared to the market average.
Poloniex vs Kraken – How It All Started?
Founder Tristan D’Agosta launched Poloniex in 2014 in the state of Delaware in the United States. Shortly after that, Ethereum (ETH) was listed for trading on Poloniex, thus becoming a pioneering crypto exchange supporting one of today’s most liquid coins, Ethereum (ETH). After launching ETH for trading on its platform, Poloniex also soared to the top of the list of exchanges with high liquidity in terms of trading volume, attracting a vast number of traders.
This platform is a good solution for novice traders as well as experienced traders. This flexibility allows inexperienced users to place their inaugural investments in a blink of an eye. At the same time, seasoned traders can reap the benefits of more complex features such as futures markets or margin trading.
The Kraken platform has been around for quite a while, making it one of the more established possibilities for buying and selling cryptocurrencies. Since its launch, this marketplace has consistently provided clients with one of the safest environments to engage in cryptocurrency trading.
The San Francisco-based firm was founded in 2011 by Jesse Powell and is a frontrunner among exchange services due to its emphasis on top-notch security features, reasonable fees, ample liquidity, and flexible payment methods. Since then, this cryptocurrency venture, with its headquarters in San Francisco, United States, has flourished to the point that it now employs a slew of crypto professionals worldwide.
This Kraken team is dedicated to expanding the accessibility and use of cryptocurrency to allow people of all socioeconomic backgrounds to participate in the industry’s growth and ultimately increase their financial independence.
Poloniex vs Kraken: The Crypto Exchange Comparison
Opening an Account
During the Poloniex account registration procedure, all that is required of you is to supply a functional email address. Due to the platform’s lack of Know Your Customer (KYC) protocol compliance, the exchange will not ask you to submit personal information.
After completing the registration process, you can instantly start investing in the crypto market, but not before you deposit some coins into your account using the Wallet service. This functionality also acts as a centralized hub for managing all of your digital holdings.
To start trading on Kraken, you must first register a trading account and fund it with initial capital. For this transaction, you can use any of the accepted fiat currencies (USD, CAD, EUR, JPY, GBP, or CHF). To access the service, you must first sign up by providing an operational email address, a distinct username, and a secure password.
In addition, the length of time that must elapse before the exchange activates your account varies depending on which of the five authentication tiers you’re in. Each user’s verification level determines which set of trading tools and deposit/withdrawal limits you’ll have access to on Kraken. In this regard, you may be required to complete a detailed Know Your Customer (KYC) questionnaire to create a trading profile on Kraken, regardless of whether it’s a personal or corporate trading account.
If you’re looking for a comprehensive trading experience, go no further than the Poloniex platform. The UI is simple, intuitive, and straightforward enough that even novice traders can use it. The exchange also provides access to a wide variety of digital currencies, allowing for easy crypto-to-crypto swaps as well as more complex trading activities, such as margin trading, P2P lending, earning passive income through staking, placing a range of order types, and trading with some of the lowest costs in the market.
Whether you’re a seasoned veteran or just starting, Kraken gives you a safe place to carry out your trading strategy. For this, Kraken offers several trading platforms to accommodate its clients. Traders without prior experience in the crypto market should begin with the Simple setting. You have the choice of placing either a market or a limit order when you select this option. The Intermediate mode’s UI is a little more intricate and provides access to more advanced trading capabilities. Finally, the Advanced interface combines everything mentioned thus far, plus additional services, including expanded limit order possibilities.
In addition to the choices mentioned above, this well-established marketplace also allows you to engage in a wide range of financial activities, such as instant trading and swapping digital assets, margin trading, trading in futures and indices, OTC trading, earning passive income through staking of your idle coins, etc.
Alongside Bitcoin (BTC), Ethereum (ETH), Tether (USDT), Bitcoin Cash (BCH), Ripple (XRP), Tron (TRX), Litecoin (LTC), USD Coin (USDC), Dash (DASH), and Monero (XMR), Poloniex offers more than 350 other cryptocurrencies, altcoins, tokens, and other digital assets. Please note that verifying the availability of any digital currencies offered on the Poloniex exchange is essential, as they may not be usable due to inconsistencies in regulatory standards between different countries.
Kraken was once only able to offer Bitcoin (BTC), but currently, it endorses over 120 different altcoins and hundreds of trading pairs between digital currencies and fiat currencies. Ethereum (ETH), Dogecoin (DOGE), Eos (EOS), Monero (XMR), Litecoin (LTC), Ripple (XRP), Tether (USDT), and Cardano (ADA) are just a handful of the coins you can find on this list.
If you want to buy or sell cryptocurrency on Kraken, you’ll need to fund your account with one of the fiat currencies the exchange supports, like the US dollar (USD), Canadian dollar (CAD), Swiss franc (CHF), British pound sterling (GBP), Euro (EUR), or Japanese yen (JPY). After selecting the national currency you intend to use, you will be presented with an overview of the available deposit methods in greater detail.
Poloniex accepts credit/debit cards supplied by payment service providers like VISA and Mastercard for all trading pairs, enabled by the reliable third-party payment processor Simplex. However, Poloniex itself does not take fiat deposits.
So, if you don’t have any cryptocurrencies but would still like to participate in the crypto market through Poloniex, you’ll need to find a fiat-gateway platform to convert your fiat currency into digital coins. Gemini or Binance are two excellent exchanges to use for this purpose.
Moving onto Kraken, this exchange also allows you to fund your account with various payment methods, including bank transfers, wire transfers, cash transactions, transfers to and from digital wallets, and payments made through third-party payment services.
Moving funds from your bank account to your Kraken balance is the most common payment method on the platform. The maximum deposits are tied to the verification status of your account. Namely, the maximum amount you can deposit increases with your account verification level. When your identity and trading account are fully verified, there are no limits on making deposits or cashing out funds through Kraken.
Trading Fees and Limits
Each trade on Poloniex incurs a fee, calculated using a tiered structure. As your 30-day trading volume increases, you will move up to the following fee tier, resulting in a decreased maker fee/taker fee rate. To that end, your fee tier is dynamically adjusted every 24 hours based on your 30-day trading volume and the TRX amount you hold.
Moreover, Simplex levies a fee for credit card payments that is equal to 3.5% of the transaction’s total, or $10, whichever one is more. This cost is added to any taxes that may apply to your trading through Poloniex. By the same token, Poloniex charges a further 0.75% on top of the Simplex processing fees. Additionally, there is a USD 50 minimum order requirement when using Simplex.
Now, let’s take a look at Kraken’s trading costs. To begin with, Kraken charges its clients according on the number of transactions they conduct. For this, the exchange calculates your trading costs every 30 days, based on the total volume of trades you’ve made during that period. In its simplest form, this fee structure rewards crypto investors for contributing to the platform’s liquidity by lowering their per-transaction fees.
Kraken’s Instant Buy service, however, comes at a greater price, but it’s worth it if you’re a beginner or value speedy transactions. Traders using the instant buy feature on Kraken should also be aware that their orders will incur additional processing fees and will not count towards their 30-day trading volume.
How Safe Are Poloniex and Kraken?
Since both Poloniex and Kraken have U.S.-based headquarters, you can rest assured that both platforms employ the best security measures and industry standards to protect your investment.
Poloniex, like all centralized exchanges, stores users’ private keys to their digital currency wallets on its servers. The majority of the money, however, is kept in cold storage, which is a highly safe off-site location. The trading system of this exchange also enables two-factor verification (2FA) and browser-recognition technologies for Poloniex users.
Polniex was hacked twice, once in 2014 and again near the end of 2020. During these cyber-attacks on the platform, hackers managed to steal a total of 12.3% of the exchange’s virtual currencies during the first security breach and around 4 million bitcoins the second time. After the incidents, Poloniex’s executives promptly made a public statement promising to return all affected clients, which is what they ultimately did. Despite these two security issues, Poloniex is considered a fairly safe trading platform.
Compared to its competitors, Kraken stands out the most in terms of security. This exchange employs cutting-edge safety measures to keep its customers’ funds secure. In addition to the platform’s built-in military-grade security measures, Kraken maintains virtually all user funds in cold storage accounts dispersed in various locations around the globe.
As this platform is built with security in mind, it also features two-factor authentication (2FA), an SSL encryption algorithm for all data exchanged via the Internet, as well as real-time surveillance of all account transactions.
Speaking of customer support, Poloniex’s platform includes a knowledge base with pieces explaining the ins and outs of the exchange and cryptocurrency market. Nonetheless, if the comments from Poloniex customers on TrustPilot are any indication, getting in touch with Poloniex’s support team might be a relatively slow process.
This cryptocurrency trading platform also has a robust Telegram, Twitter, Instagram, and Facebook presence. Poloniex also offers the Trollbox service that facilitates your communication with other users of the network, allowing for the exchange of ideas, suggestions, and recommendations.
Back to Kraken, this exchange is distinguished from other cryptocurrency exchanges by its superior value of client service. Being in the crypto trading industry for quite some time now, the exchange is well-versed in the wants and demands of traders of all skill levels.
Kraken’s customer support is available whenever you need them 24/7 through a live chat feature, so you can get any questions or concerns answered promptly. You’d be hard-pressed to find many other cryptocurrency exchanges that provide phone support, so the fact that this one does is a big plus if you need a speedy and thorough answer to your issue.
What’s more, you can still reach out to the Kraken support team for assistance even when most businesses and organizations are closed in observance of a national or religious holiday. Email, prioritized queries, and messaging apps quickly put you in touch with the service’s helpful staff whenever you need them.
Poloniex’s mobile app makes trading on the go even more accessible than using the web interface. Namely, this app can be used on smartphones and tablets running the Android and iOS platforms to do spot, futures, and other trades regardless of your skill level. Also, you can easily track the progress of your portfolio and trades on the go to ensure you never miss a beat in the market.
Moreover, you can invest in over 500 different spot trading pairings, all of which are crypto-based and potentially groundbreaking. Into the bargain, you can fund and withdraw from your cryptocurrency wallet, keep a close watch on your account and trade details, get global market ticker updates in real-time, and set up price alerts for the cryptocurrencies you’re interested in through the Poloniex mobile app.
Being a user-friendly service, Kraken also provides a smartphone app that makes purchasing and selling cryptocurrencies more straightforward, safe, and efficient. Whatever your level of expertise, using the exchange’s mobile app to buy and sell cryptocurrencies is a breeze. You can quickly and easily swap between different currencies, establish order quantities with a single swipe of the interface, review past trades, and much more with Kraken’s mobile trading app.
Ultimately, Kraken’s mobile app makes investing in and managing your cryptocurrency portfolio straightforward, safe, and secure, whether you’re looking to buy Bitcoin (BTC), Ethereum (ETH), Dogecoin (DOGE), or some less popular coin.
Kraken and Poloniex Comparison with Other Exchanges
Understandably, you might be curious about how these two markets compare to the rest of the field. That’s why I’ve contrasted them with two of the most popular exchanges in the industry, Binance and Coinbase.
If you want a cryptocurrency exchange that lives up to its numerous accolades, your best bet is Binance. If you’re looking for a place to buy or sell virtually any cryptocurrency that has been issued, go no further than this global marketplace. Furthermore, compared to its competitors, Binance supports the most significant number of different cryptocurrencies and offers some of the lowest trading costs in the business. However, I can safely tell that Kraken and Poloniex have come very close to Binance’s low trading charges themselves.
Nevertheless, there are certain shortcomings to Binance, just like there are to anything else. One major negative of this exchange is the absence of regulations, which removes dealers’ legal responsibility to you as a trader in case of a security breach. Poloniex and Kraken, on the other hand, are both highly regulated exchanges that safeguard your cryptocurrency and insure it.
Coinbase, only slightly behind Binance in popularity, is the second most used cryptocurrency exchange globally. If Binance is the Mecca of altcoins, Coinbase must be the American Paradise of Newbies. If you’re new to cryptocurrency trading, you’ll be able to feel like a pro using this beginner-friendly platform’s features in no time.
And while Kraken and Poloniex serve both beginners and professional traders well, I believe the less experienced investors would be slightly overwhelmed by the advanced trading options offered on these two exchanges.
In contrast to Kraken and Poloniex, Coinbase’s trading fees are not among the most competitively priced in the industry. In point of fact, the fee model utilised by Coinbase is not only complicated but also contributes to the increased overall costs associated with trading.
Poloniex is an established marketplace that was once among the fastest-growing in terms of daily users. Although initially successful, Poloniex appears to have slowed down as the market flooded with competing cryptocurrency trading sites. Worse still, the platform’s otherwise stellar reputation was marred by a security compromise. If you want to err on the side of caution, though, I suggest retaining only the amount of money in your Poloniex account you expect to use in the near future for borrowing, trading, or swapping.
With Kraken on the other end of my crypto scale, you should have no security concerns because it is one of the most secure platforms ever developed. By secure, I don’t imply merely activating the 2FA protocol and several more implemented safeguarding mechanisms. Kraken employs a real manforce security comprised of armed guards and 24/7 surveillance of the geographically dispersed cold storage facilities where the exchange holds the deposited digital assets. In light of this information alone, I believe that Kraken is a superior alternative to Poloniex.