Key Moments:
- Kraken has acquired Small Exchange for $100 million, granting entry to the US derivatives market
- This move gives Kraken a CFTC-regulated Designated Contract Market (DCM) license in the United States
- Kraken now operates regulated venues in the US, UK, and EU, supporting six fiat currencies and over 450 assets
Major Entry into US Regulated Derivatives
Kraken has announced the acquisition of Small Exchange in a $100 million deal, giving the company a strategic foothold in the United States’ regulated derivatives market. With Small Exchange’s status as a Commodity Futures Trading Commission (CFTC)-registered Designated Contract Market (DCM), Kraken is now licensed to run a federally regulated exchange, opening new avenues in the rapidly expanding US prediction market.
Small Exchange was previously under the ownership of IG Group. The DCM license now positions Kraken as a possible competitor to other US-based prediction market platforms such as Polymarket and Kalshi, at a time when such platforms are facing scrutiny across various states. Kraken has not specified any intentions relating to sports betting offerings.
🔥 Kraken goes full throttle in U.S. derivatives
Kraken just acquired Small Exchange for $100M, gaining a CFTC-regulated derivatives market license.
This sets the stage for a fully U.S.-based platform connecting spot, futures, and margin – all under one regulated roof.
Big… pic.twitter.com/mnhGsjH2nU
— GandalfCrypto (@gandalfcryptto) October 17, 2025
Strategic Vision and Unified Trading Environment
According to the company, this acquisition marks a defining moment for its pursuit of innovation in US derivatives. Kraken stated that the deal “advances our mission to build a unified, high-performance trading environment,” pointing to the DCM license as a gateway to listing and managing regulated exchange-traded derivatives under CFTC supervision.
Co-CEO Arjun Sethi noted, “Kraken’s acquisition of a CFTC-regulated Designated Contract Market creates the foundation for a new generation of United States derivatives markets.” He emphasized the platform’s scalability, transparency, and efficiency, aiming to enhance Kraken’s portfolio of trading products. Sethi added, “This step connects spot, futures and margin products inside a single regulated liquidity system, reducing fragmentation, lowering funding latency and bringing onshore the kind of access and performance that has mostly existed offshore.” He also highlighted the ability to “integrate clearing, risk and matching into one environment that meets the same standards as the largest exchanges in the world.”
Expansion Across Key Markets
With Small Exchange’s addition, Kraken now operates regulated derivatives venues in the United States, the United Kingdom, and the European Union. This platform expansion supports trading across six fiat currencies and more than 450 digital and traditional instruments.
“Together, these elements create a network that moves collateral in real time, nets exposure across jurisdictions, and reduces capital inefficiencies that have long held back US traders,” according to Sethi. “This is not about marketing or narrative. It is about building better market structure.”
| Region | Venue | Regulator | Assets Supported |
|---|---|---|---|
| United States | Small Exchange | CFTC (DCM) | Over 450 assets |
| United Kingdom | Crypto Facilities | FCA | Over 450 assets |
| European Union | Crypto Facilities | MiFID II | Over 450 assets |
Growing Footprint in Futures and Beyond
This latest move follows Kraken’s previous steps into the US futures market. The company purchased NinjaTrader earlier this year, which enabled the trading of CME-listed crypto futures alongside spot crypto offerings. In October, Kraken’s platform expanded to cover equities, FX indices, and commodities including oil and gold.
Back in 2019, Kraken acquired Crypto Facilities, a platform overseen by the UK’s Financial Conduct Authority, now serving as the core for what the company claims to be Europe’s largest regulated crypto futures market under MiFID II regulations.
Kraken commented, “By securing the necessary licensing and infrastructure today, we are laying the groundwork for institutional-grade markets as crypto matures.”
- Author
Daniel Williams
