Kraken launches self-custodial wallet, joining competitors like Coinbase

Kraken, the second-largest U.S.-based cryptocurrency exchange, has introduced its own digital wallet, aligning its offerings with those of competitors like Coinbase.

The “Kraken Wallet,” which is self-custodial, will be available starting Wednesday to both Kraken users and non-users. This new wallet supports eight blockchains, including Bitcoin, Ethereum, Solana, and Dogecoin.

Kraken’s wallet will be open-sourced, a first for a major exchange as it seeks to stand out in a crowded market. This approach allows developers to access and contribute to the wallet’s codebase. Additionally, Kraken is incentivizing developers to identify and report vulnerabilities through its open-source grant program to improve the wallet’s security.

Kraken emphasizes privacy with its wallet design, collecting only minimal data necessary for operation and using its infrastructure to proxy user activity, which helps shield users’ IP addresses and location information from external exposure.

Coinbase’s wallet remains highly popular, and other major exchanges like Binance and OKX also offer similar products. According to Eric Kuhn, Kraken’s Product Director, the company has opted for self-custody of assets for over a decade to support user privacy and open-source development with this new product.

“Kraken has been telling people for more than ten years to self-custody their assets. We built Kraken Wallet on the principles central to the crypto space, such as user privacy and open-source code. There’s a lot of interesting things that are happening on-chain and we wanted a wallet that enables people to go and access these ecosystems,” he told CoinDesk.

The wallet is part of Kraken’s broader strategy to expand its product suite, particularly in the wake of the FTX collapse, which highlighted the risks associated with centralized exchanges.

On the regulator front, Kraken has been pushing back against the U.S. Securities and Exchange Commission (SEC), seeking to toss out a lawsuit that accused the platform of operating without proper registration.

Kraken’s counter comes amid a broader industry backlash against the SEC, with giants like Binance and Coinbase also throwing their hats into the ring with similar dismissal petitions. These moves spotlight the crypto sector’s growing impatience with what they argue is the SEC’s attempt to stretch its regulatory tentacles too far.