Kraken Seeks New Funding at $20B Valuation After $500M Raise

Cryptocurrency exchange Kraken is in advanced discussions to raise fresh capital at a $20 billion valuation, following the completion a $500 million funding round at a $15 billion valuation, according to Bloomberg News.

The new funding round would include a commitment of $200 million to $300 million from a strategic investor, Bloomberg reported on Friday, citing a person familiar with the discussions. A Kraken spokesperson declined to comment on the report.

The potential deal, subject to market conditions, would represent a 33% valuation increase from the company's previous round completed last week. The rapid valuation jump reflects surging investor appetite for crypto infrastructure companies amid improving regulatory clarity and accelerating institutional adoption.

Kraken closed its $500 million funding round at the $15 billion valuation last week, according to Fortune, with participation from investment managers, venture capital firms, and co-CEO Arjun Sethi through his firm Tribe Capital. The raise marked a dramatic shift for a company that had previously relied on minimal outside capital, having raised just $27 million prior to 2025.

The funding activity positions Kraken for a potential initial public offering now expected in 2026, following executive restructuring and aggressive expansion that has reshaped the 14-year-old exchange. Sethi, who became co-CEO in October 2024, has driven significant changes to the company's leadership team and strategic direction.

His tenure coincided with the departure of senior executives including the CTO, COO, sales leads, and general counsel. While Kraken characterized the restructuring as streamlining operations, some insiders told Fortune the changes affected morale and consolidated Sethi's control, even as co-CEO Dave Ripley retained his title.

The company has pursued substantial acquisitions, including the $1.5 billion purchase of retail futures trading platform NinjaTrader announced in March. Sethi called the deal "the largest-ever deal combining traditional finance and crypto." Kraken has also launched tokenized stock trading through its "xStocks" product, offering shares of companies like Apple and Tesla, which gained early traction in markets such as South Africa.

Recent financial disclosures show $411 million in second-quarter revenue and nearly $80 million in post-EBITDA earnings, demonstrating the exchange's profitability as it prepares for public market scrutiny. Founded in 2011, Kraken operates as a major global crypto exchange offering spot, margin and derivatives trading across more than 200 assets and eight fiat currencies, serving over nine million traders and institutions worldwide.

With competitors including Circle and Gemini already trading publicly, some investors fear waiting until 2026 could expose Kraken to market timing risks if crypto sentiment cools. However, Sethi has maintained the company will only pursue an IPO under conditions that benefit users and shareholders.