Kraken says UK rules bar 75% of its US products from UK users

Kraken co-CEO Arjun Sethi criticized the U.K.’s crypto financial-promotion rules, arguing they slow transactions and restrict which products the exchange can offer locally.

He pointed to requirements to display prominent risk warnings, remove incentives to invest and add extra steps before users can buy tokens. In his view, those measures delay the movement of funds and limit access to services that are available in other markets.

By his estimate, Kraken customers in the U.K. cannot access about three-quarters of the products open to users in the United States, including higher-yield features and lending through decentralized finance protocols.

The Financial Conduct Authority’s framework requires clear risk warnings on websites and apps, “positive frictions” that slow sign-ups or purchases, and “appropriateness assessments” to test whether customers understand the risks. “In the U.K. today, if you go to any crypto website, including Kraken’s, you see the equivalent to a cigarette-box warning ‘use this and you’re going to die’,” Sethi remarked. “Disclosures are important, but if there are 14 steps, it’s worse.”

The regulator defended the rules as helping customers understand benefits and risks before acting.

Customers must answer questions before a firm makes a financial promotion to them, but this is not required every time a customer makes a trade, so [it] should not generally prevent them acting where they want to. Some consumers may make an informed decision that investing in crypto is not right for them — that is our rules working as intended.

Executives in the digital-asset sector have long argued the U.K. is too cautious. Industry groups have pressed for a more accommodating approach this year as U.S. policy under President Donald Trump has been more supportive of crypto.

Sethi has co-led Kraken since October 2024 alongside David Ripley and chairs venture firm Tribe Capital. He contended that the U.K.’s stricter consumer-protection approach directly affects product availability for Kraken’s British users and may deter some from investing.

Beyond the rules debate, Kraken runs a venue for trading tokenized representations of listed equities. Sethi ruled out offering tokenized shares of private companies, contrasting with a recent plan floated by Robinhood, and called tokenizing private stock “a terrible idea” because investors could struggle to sell when they want.

Kraken is preparing for a listing in New York, with no timeline provided.