Is Kraken Safe? What UK Users Need to Know
Short answer: Yes. Kraken is one of the safer crypto exchanges available to UK users. It holds dual FCA registration (cryptoasset business + Electronic Money Institution), stores over 95% of funds in cold storage, and maintains ISO/IEC 27001:2022 certification. However, some UK users report account holds during compliance checks, which can be slow to resolve.
Security at a Glance
| FCA Registration | Dual: cryptoasset register + EMI (Payward Ltd, FRN 928768) | |
| Cold Storage | 95%+ of customer funds | |
| 2FA | TOTP-based (no SMS, which prevents SIM-swap attacks) | |
| Proof of Reserves | Merkle-tree reporting with self-verification | |
| Security Certifications | ISO/IEC 27001:2022 + SOC 2 Type 1 | |
| Bug Bounty | Active programme | |
| Insurance | No public insurance disclosure for UK users | |
| FSCS Protection | Not covered (no crypto exchange is) | |
| CryptoReview Score | 7.7/10 aggregated |
FCA Registration: What It Means
Kraken is registered with the Financial Conduct Authority through Payward Ltd (FRN 928768, Company Number 08593670). Kraken holds two types of FCA authorisation:
- Cryptoasset register: confirms compliance with UK anti-money-laundering (AML) requirements
- Electronic Money Institution (EMI): authorises Kraken to issue e-money and handle GBP transactions
This dual registration gives Kraken one of the stronger UK regulatory footprints among crypto exchanges. You can verify Kraken's status directly on the FCA Register.
Important: FCA registration does not mean your crypto is protected by the Financial Services Compensation Scheme (FSCS). No crypto exchange in the UK currently offers FSCS protection.
How Kraken Protects Your Funds
Cold storage: Over 95% of all customer funds are held offline in geographically distributed cold wallets, away from internet-connected systems.
Advanced account security: Kraken offers two features that most competitors don't:
- Global Settings Lock: prevents changes to your account settings (email, password, 2FA) for a fixed period, even if someone gains access
- Master Key: a recovery mechanism that adds an extra layer of protection against account takeover
No SMS-based 2FA: Kraken uses time-based one-time passwords (TOTP) only, which eliminates the risk of SIM-swap attacks, a common way crypto accounts are compromised on other platforms.
Proof of Reserves: Kraken publishes regular Proof of Reserves reports using Merkle-tree cryptography. You can independently verify that your funds are included in Kraken's reserves.
What Are the Risks?
No exchange is risk-free. Here's what UK users should be aware of:
Account holds: The most common complaint from UK Kraken users involves accounts or withdrawals being frozen during AML/KYC compliance checks. These can take days or weeks to resolve, often with limited explanation from support.
Instant Buy fees: If you use Kraken's simple “Instant Buy/Sell” instead of Kraken Pro, you'll pay a fixed 1% fee plus spread, making it more expensive than it first appears. This isn't a safety issue, but it catches beginners off guard.
Support escalation: Kraken's live chat handles basic queries well, but compliance-related issues (account restrictions, closures) are escalated to specialist teams with longer response times.
How Users Rate Kraken
| Platform | Rating |
|---|---|
| Trustpilot | 7.0/10 |
| Reddit Sentiment | 7.0/10 |
| Google Play | 8.2/10 |
| App Store | 9.4/10 |
| CryptoReview Aggregated | 7.7/10 |
App store ratings are strong across both iOS and Android. Negative reviews tend to cluster around the account-hold and compliance experiences described above.
Our Verdict
Kraken is a safe and well-regulated option for UK crypto users, particularly those who value strong security tooling and transparent reserve reporting. Its dual FCA registration, cold storage practices, and advanced account protection features put it in the top tier for security.
The trade-off is Kraken's rigorous compliance approach, which can result in frustrating account holds for some users. If security and regulation are your top priorities, Kraken is a strong choice.
→ Read our full Kraken Review for fees, features, and a detailed breakdown.