Kraken refuses to pay extortionists over threatened leak

Kraken review discussions picked up after the exchange said it refused to pay extortionists who threatened to publish videos allegedly showing client data from its internal systems. Nick Percoco, Kraken’s chief security officer, posted on X that an unnamed criminal group demanded an unspecified sum and threatened to release footage depicting internal systems with client information. Percoco wrote that Kraken’s systems were never breached and that user funds were not at risk.

Percoco reported two incidents of inappropriate access: one in February 2025 and a more recent event involving roughly 2,000 user accounts. The exchange has not detailed what types of data appear in the videos or named the group behind the threats.

Kraken is coordinating with federal law enforcement as investigators gather evidence and trace the perpetrators. The company indicated the inquiry could lead to arrests but did not provide a timeline for the investigation.

“We will not pay these criminals. We will not ever negotiate with bad actors,” Percoco wrote. Kraken said it will notify affected users but has not released a full timeline or a complete scope of the exposed information.

In a related incident in May 2025, another large U.S. exchange reported an extortion attempt tied to compromised customer-support contractors that exposed data from about 70,000 users and included a $20 million demand.

Industry data show losses from major crypto incidents rose to about $178 million in March 2026, up from $49.3 million in February. Reports indicate many recent attacks have relied on social-engineering and authorization abuse, where victims unknowingly approve actions that give attackers access to accounts or funds.

Kraken emphasized a distinction between data exposure and custody of assets, reiterating that customers’ funds were not at risk in the reported incidents.