Choosing a crypto exchange is an individual experience. There are hundreds of exchanges, and each of them offers traders or crypto investors a different style and of buying and selling crypto on the markets. You need to match your exchange to your needs as a trader, or you risk losing money or missing out on opportunities.
If you’re a profitable trader looking for the best exchange, then Bitfinex and Kraken are two of your top choices. These exchanges are not for beginner traders, and both have advanced trading platforms with all the tools and features you need to make money on the markets every day.
However, both Bitfinex and Kraken are quite different exchanges competing for separate segments of the same crypto market. In this review, we’ll look at Bitfinex Vs. Kraken, and see which exchange is the right venue to host your trading account.
What Do You Need to Know About Bitfinex?
Bitfinex was one of the first Bitcoin exchanges to offer customers peer-to-peer lending to fund margin trading on the platform. Since its launch in 2011, Bitfinex has always been at the forefront of the crypto community, and it was the first exchange to launch the stable coin Tether, which was a miracle for traders that were looking to reduce their exposure to market volatility.
Over the last nearly ten years of operations, Bitfinex kept adding coins, tokens, and markets to its offering, drawing thousands of crypto enthusiasts from around the globe. While there are plenty of other exchanges out there that eclipse Bitfinex in terms of trading volumes, Bitfinex remains the most liquid exchange in the market, making it an attractive venue for elite and institutional traders.
In 2016, Bitfinex was the victim of the largest hack in crypto exchange history, losing some 120,000 BTC, worth $65-million at the time of the heist. Many internet crypto heads went onto blogs to complain about the company and its lack of ethics.
Today, Bitfinex doesn’t care about volume and acquiring mass amounts of retail traders. Bitfinex focuses on serving whales and institutional traders. If you’re not prepared to trade with big money, then Bitfinex would rather you took your business elsewhere.
What Do You Need to Know About Kraken?
Jesse Powell is the founding member of Kraken, and he’s one of the original members of the MtGox team, left to clear up the mess in the wake of the 2013 hack that crippled said exchange. Kraken launched in 2013 to European traders.
After a few months, Kraken was already leading the European exchange market with its trading volume. Powell spent years dedicating his life to building Kraken’s reputation in the eyes of the crypto community and the fiat financial system.
The trustees involved with managing the MtGox estate, and sale of the remaining tokens on the platform, used Kraken to facilitate the deal.
The Chicago Mercantile Exchange (CME Group) was the first official regulated financial institution to create a Bitcoin futures market back in 2018. CME relies on live pricing data from Kraken for this asset. Kraken consistently remains in the top 100 crypto exchanges each year, with good liquidity and fair fees.
Bitfinex Or Kraken Market Is Bigger?
Bitfinex developed its markets over the last 9 to 10 years, choosing the best pairs that offer the best volume and choice for traders and institutional investors. With $87-billion in cash reserves, Bitfinex is the most liquid exchange in the world, operating in 274 markets, with more than $180-million in daily volume.
There are more than 60 cryptos and tokens available on the platform, with numerous trading pairs available. The USD, BTC, and ETH have the best liquidity, highest volume, and the most trading pairs available. Bitfinex also offers fiat/crypto pairs for the Euro, Yen, and Pound Sterling. However, if you want to trade fiat pairs, you only have options with BTC or ETH.
Kraken features 17 cryptos and tokens, as well as five fiat currencies to choose from. Kraken only operates in half the markets that Bitfinex does, with 140 pairs available for your trades. With more than $295-million in daily volume, and decent liquidity, Kraken is ahead of Bitfinex in daily volumes, but way behind in liquidity.
Which One Is Cheaper? Bitfinex Or Kraken?
Bitfinex doesn’t charge fees for crypto deposits, but fiat deposits carry a 0.1% charge, with a minimum fee of $60 per deposit. Transaction fees with Bitfinex begin at 0.1% for taking liquidity, and 0.2% for adding liquidity.
Bitfinex prefers its clients to be institutional or professional day traders with large account balances. It’s for this reason that they only start offering discounts on the fee structure when the customer’s 30-day trading volume reaches more than $500,000. Traders doing monthly volumes over $7,500,000 level, pay no fees.
Bitfinex is a margin trading platform, allowing traders to utilize leverage on their trades. However, the platform charges 15% on all generated fees from margin providers. Bitfinex charges 18% on fees from margin providers opened using a hidden offer. Bitfinex is around 20% cheaper with BTC withdrawals from your account, with a rate of 0.0004%, that’s 0.0001% less than the industry average of 0.0005%.
Most cryptocurrencies are free to deposit on Kraken. However, there are minimum deposit limits for each crypto on Kraken, so check the companies listings before transferring your deposit. The maker/taker model on Kraken offers traders fees of 0.16% and 0.26%, respectively. Traders receive discounts on fees when monthly trading volumes exceed $100,000. Fees on Kraken will reach the lowest levels (0% and 0.1%) if trading volume is more than $10,000,000.
Is Bitfinex More User Friendly Than Kraken?
Bitfinex is not a regulated exchange, and its offices are in the British Virgin Islands. As a result, Bitfinex cannot accept fiat currency for a deposit, and they do not offer withdrawals in fiat. Kraken is not a regulated exchange, but they are a US-facing exchange that’s part of the Federal Reserve’s Data Asset Transfer Authority (DATA), as well as the Japan Authority of Digital Assets (JADA).
Bitfinex lets its customers trade the spot market through its web application. Institutional traders can access its OTC desk for large orders. Bitfinex is also the inventor of margin trading on a peer-to-peer basis, whereas Kraken prefers to fund margin trading using its account. It’s also worth noting that Kraken is one of the few US-facing exchanges offering margin trading accounts.
However, Kraken restricts its margin trading to pairs with the highest trading volumes, such as BTC/USD or ETH/EUR. For those traders that don’t have the risk tolerance for margin trading, market and limit orders are available.
Bitfinex no longer accepts American passport holders to open accounts on the platform, so you’ll have to go with Kraken if that’s the case for you. Kraken had to withdraw its offering from 12 US states due to problems with the regulatory bodies.
When it comes to verification, Bitfinex requires customers to submit copies of ID scans, bank statements and a proof address when depositing fiat currencies to fund your trading account. It can take up to 8-weeks for the Bitfinex team to prove your account, and if they feel you don’t meet the exchange’s criteria, they may refuse your funding request.
Kraken offers a tiered verification process, where American customers must provide proof of identity and address when depositing with Fiat currencies.
Can We Trade Via Mobile In Bitfinex And Kraken?
Bitfinex offers users mobile trading platforms for iOS and Android devices. The Android version seems to have better reviews, but both seem to lack plenty of features traders need. The most common issues reported around the mobile platform include sluggish execution, poor performance, and a complicated user interface for mobile.
Kraken introduced a mobile app in 2014. However, it only launched an app for iOS, and never bothered updating it. Kraken doesn’t see their customers using mobile devices when trading and decided to abandon the project.
Bitfinex Or Kraken Has Better Support?
Both Kraken and Bitfinex are notorious for having some of the worst customer service offerings for crypto exchanges. Bitfinex got into some serious trouble in 2018 after it closed deposits and redemptions for months following the hack.
The Verdict By Bitcoin Tester
Unless you have a large account balance, the chances are you won’t get approved by the Bitfinex team. Bitfinex makes it clear that they don’t want the platform to be a place for newbie traders. Bitfinex is focusing on the institutional market and whales.
Kraken is more friendly toward retail traders, and it offers a comprehensive selection of technical analysis tools and useful features on its platform. Kraken is a good choice for professional day traders that are trying to find a platform that’s as serious about their trading as they are.