The Ethereum foundation is planning a hard fork at block 2463000, expected to be reached on Tuesday October 18th 2016 PDT. The fork introduces changes to help protect against the recent DOS attacks on the network. The fork is expected to go very smoothly with the DOS-protected fork quickly becoming the dominant chain while the old vulnerable chain quickly dies out. Learn more about the hard fork and follow updates from the Ethereum foundation on their blog.
What Kraken clients need to know about the hard fork
Funding for ETH, ETC, DAO, REP will be halted - do not send deposits during the fork Kraken will halt funding of ETH and all related assets (ETC, DAO, REP) a couple of hours prior to the fork. Client funds will be safely secured on Kraken during this period. Funding will be re-enabled after the outcome of the fork is clear and the network is safe. Kraken clients should not send ETH, ETC, DAO or REP deposits during the fork.
Trading will continue as normal Trading of ETH and all related assets (ETC, DAO, REP) will continue as normal. All ETH, ETC, DAO and REP balances will be tokens of the dominant chain (the chain with the most work on it) after the fork.
Will Kraken support balances and trading on the non-dominant chain? No - Kraken will only support the dominant chain (the chain with the most work on it).
Update your Ethereum client Everyone should update their Ethereum client to the latest version. ETC users should use the latest version of Parity or the official Ethereum Classic Go client (https://github.com/ethereumproject/go-ethereum/releases). ETC users should not use the current version of the foundation Geth client, since it will fork ETC on Tuesday.
Why is ETC funding being halted? An ETC fork is planned for October 25th. However, there is some risk of an unintentional ETC fork along with the ETH fork, because many people are running normal ETH clients with the classic flag set. Due to these risks, ETC funding will also be halted while the outcome of the ETH fork is determined.
Augur (REP) margin trading is now available on Kraken! Read on for the details.
What currency pairs and leverages are available?
REP/XBT, REP/ETH, REP/EUR: 2x
What are the REP borrow limits?
The REP borrow limits depend on the verification level of the account as follows:
Tier 1: 200 REP
Tier 2: 1000 REP
Tier 3: 2500 REP
Tier 4: 5000 REP
What are the margin fees?
Margin open fee = 0.02%
Rollover fee = 0.02% / 4 hrs
REP not a collateral currency
Please note that REP will not be a collateral currency, meaning that you cannot open margin positions against the value of your REP balances. For this reason you should always maintain adequate balances in other collateral currencies to maintain your margin positions. To see the current list of collateral currencies, go here: https://support.kraken.com/hc/en-us/articles/204585998-Collateral-Currency
Learn more about margin trading
Why do traders like margin trading? Because it allows you to leverage your account for greater profits. However it also comes with greater risk - if you are unfamiliar with margin trading and how it works, you can learn all about it by visiting the two sections on margin trading in our Support Center.
Today Kraken is pleased to launch support for trading Augur Reputation Tokens (REP). The Augur team expressed their excitement for this important step in the overall Augur launch, saying
We all know that Kraken is one of the top exchanges in the space. This is more important: we are personal fans of the overall Kraken trading experience. We use Kraken, we trust Kraken and – this true – even Joey Krug’s mom uses Kraken! We are elated that they’re featuring REP trading on their platform. We predict that trading of REP on Kraken will be strong :)
Built on Ethereum, Augur is a decentralized global platform for prediction markets. Augur allows anyone to create, trade or monitor prediction markets on any topic.
An essential service to the markets is a decentralized oracle that reports the final outcome of events the markets were predicting and this is where REP comes in. Owning REP and storing them in your private wallet grants the right to get paid in exchange for accurately and reliably reporting on the outcome of events. Reporters need only report correctly for the markets assigned to them but receive their share of 50% of the trading fees from all Augur markets.
The prediction markets will not be enabled until later (exact date not set - probably in a few weeks), so for now REP can only be transferred and traded on Kraken.
Deposit your REP to Kraken: In your Kraken account go to Funding > Deposit > REP to find the address for depositing REP to your Kraken account.
Note: After the prediction markets are enabled (exact date not set - probably in a few weeks), note that REP deposited to Kraken are converted to a dormant state, meaning that it will be free from the reporting requirements. Also, REP withdrawals will be sent in the dormant state and must be activated after they are withdrawn for reporting. We have confirmed with the Augur team that there is no penalty or fine for REP held on Kraken in the dormant state (some of the Augur documentation suggests otherwise, but this documentation is out of date). However, to be eligible to earn a share of the Augur trading fees, REP first must be withdrawn and activated from the dormant state.
We have received many reports lately of clients falling victim to phishing sites appearing in the ads, above the organic search results, of all of the major search engines.
Unfortunately, it seems to be easier to get an ad up than it is to have one taken down. Our efforts at reporting the malignant ads have, so far, only resulted in temporary removal. The matter is now in the hands of our legal team, who are seeking a more permanent cure.
Other services in the ecosystem are suffering the same scourge:
Clients who have reused their Kraken password on their email accounts (and other services) likely have had those accounts compromised as well. If an attacker also has control of your email account, you will not receive alerts about the suspicious activity on your Kraken account. This is why it is imperative that passwords not be reused across services.
When dealing with financial services, it is always important to practice safe browsing.
Assume ads in search results are phishing
Assume that you can’t tell the difference between an ad and organic search result
Set yourself bookmarks and rely on those for navigating to the desired site
Type the desired domain in the address bar yourself
Verify that you are on the correct domain before entering credentials
Here is a screenshot of the website responsible for the recent phishing attempts.
Notice that the domain contains an extra character and does not support https. If you enter your two-factor authentication into a phishing site such as this, it is likely that the attacker will be able to use your two-factor code to log in to the real Kraken site. So, it is extremely important to be diligent, even with two-factor authentication enabled on login.
Here are some screenshots of what the imposter ads look like.
Google:
Yahoo:
Bing:
Phishing ads look just like the organic search results for the real site, and even appear above the real site. The search engines further deceive you by allowing the attacker to specify the domain that is displayed in the ad, despite it not matching the domain you are ultimately directed to upon following the link. After clicking a link in search results, it is important to always verify that you have landed on the domain you expected.
What to do if you’ve been phished
If you believe you have entered your credentials in to a phishing site, immediately log in to Kraken.com, change your password and apply two-factor authentication to login. If you reused your credentials on your email or other accounts, you must change those as well. Note that until you have control over your email account, an attacker may be able to reset your passwords with other services. After you have secured your accounts, contact Kraken support to alert us of the potential compromise.
A note about other recent reports of compromised Kraken accounts
Three weeks ago, we notified many clients of actual or attempted breaches of their Kraken accounts. The attackers appeared to be operating from a list of usernames/passwords obtained from another Bitcoin company. Two weeks after those notices went out, one of the largest Bitcoin exchanges reported a major hack and asked all its users to change their passwords. While we do not have conclusive evidence that the events are related, information from our clients indicates an extremely strong correlation. Some members of the community have gotten to speculating about the relationship between the incidents:
In the absence of an official report from the hacked exchange, we may never know for sure. Again, another reason to use two-factor authentication on login, and not reuse credentials across services.
No evidence of Kraken itself being hacked
We have no reason to believe that Kraken itself has been breached. The vast majority of reports of hacked accounts so far have admitted to reusing credentials across services, and have not used two-factor authentication on login.
Some hacked accounts had two-factor set only on withdrawals but had not enabled the settings lock, which left open the opportunity for an attacker to remove the setting upon logging in.
As mentioned earlier, even with two-factor set on login, if the two-factor code is entered in to a phishing site, the attacker can perform a “man-in-the-middle” attack, intercept the code (along with your username and password) and use it to log in to the real Kraken.com on your account.
To learn how to use Kraken’s security features to protect your account, see:
We are working on more features to protect our clients, and help our clients protect themselves. We know that it’s easy to slip up, even while actively practicing good security 99.99% of the time. We are improving our systems to better catch anomalous activity, and our interface to make the advanced security settings easier to understand. You might begin to notice small “annoyances” like withdrawal delays as we tweak our system. We thank you for patience.
The ETC funding gateway is expected to come online on Thursday July 28th sometime before 12pm UTC. Edit: ETC funding is now live!
If I deposit ETH will Kraken credit my ETC too?
If you have not yet split your ETH and ETC into different wallets and are worried about the replay attack, you can safely make an ETH deposit to Kraken. The transaction will automatically be replayed on the ETC network if possible and you will receive both your ETH deposit and an equal amount of ETC. However, the ETC will not be credited to your account until our ETC gateway comes online (see above for the ETA on this). But keep in mind that if the ETH deposit cannot be replayed on the ETC network, then you will of course not be credited for any ETC (they will still be in your wallet). One scenario in which the ETC transaction will not be replayable is if you deposit more ETH than you have in ETC.
Support for contract and block reward deposits
When the ETC gateway comes online the ETH gateway will also be updated. Both gateways will for the first time support deposits from contracts and deposits from block rewards. This means that your Kraken deposit address can be used as the destination address for transactions resulting from contracts. You can also use your Kraken deposit address for block rewards. Another benefit is that the standard Ethereum wallet (Mist) uses a contract as default wallet, so you can now use this default wallet to make deposits to Kraken.
Reminder: Removing the ICAP deposit option
Remember that we are removing the ICAP deposit option for both ETH and ETC. If you use any ICAP deposit addresses you should switch over to hex addresses immediately. Almost all of our clients use hex addresses already, so only a few will be affected by this change.
Last week the Ethereum hard fork went smoothly with the chain reimbursing DAO investors becoming dominant very quickly. As stated by email and on our blog (http://blog.kraken.com/post/147619017767), ETH balances on Kraken after the fork are tokens of this dominant chain.
However, the competing chain that does not reimburse DAO investors remains viable with a significant community of support. This network has come to be known as Ethereum Classic and the tokens are called classic ethers (ETC).
Kraken has elected to support classic ether along with most of the major Ethereum exchanges. Kraken is offering the following ETC trading pairs:
ETC/XBT ETC/ETH ETC/USD ETC/EUR
These new markets will likely be thin at first, so please pay attention to the depth of the order book and utilize limit orders to avoid slippage.
ETC Credits
Along with the launch of the new trading pairs, Kraken is crediting client accounts with their ETC balance if they had an ETH balance on Kraken at the fork.
The fork was at block 1920000, which was on July 20 at 13:20:40 PM UTC. The ETC balance credited to an account will be equivalent to the ETH balance on the account at that time plus any queued but unsettled deposits and minus any queued but unsettled withdrawals.
ETC funding delayed
ETC deposits and withdrawals are unfortunately not available yet. Our current estimate is that ETC funding will be available 24-48 hours after ETC markets open.
Removing the ICAP deposit option
Please note that along with the update adding ETC markets and balances we are removing the ICAP deposit option for both ETH and ETC. If you use any ICAP deposit addresses you should switch over to hex addresses immediately. Almost all of our clients use hex addresses already, so only a few will be affected by this change.
Beware the replay risk
If you plan to keep both ETH and ETC in private wallets, make sure you understand the risk of the replay attack and take appropriate steps to protect yourself. For more information on the replay attack see our previous blog post (http://blog.kraken.com/post/147619017767).
If you have funds in a wallet that can be replayed, you can safely send an ETH deposit to Kraken from this wallet and receive credit in your Kraken account for both the ETH and an equal amount of ETC. For more information on this option, see this blog post: http://blog.kraken.com/post/148071533482
The Ethereum community has elected to do a hard fork in order to resolve the DAO exploit. The MainNet block on which the hard fork will occur is set at 1920000, which should be reached on July 20 or 21 depending on your time zone.
In an email statement to clients last week about the hard fork we said:
ETH deposits and withdrawals will be disabled approximately 1 hour before the hard fork activates. Trading will continue as normal during the fork. All ETH on Kraken after the fork will be tokens of the winning chain (i.e. the chain with the most work on it). ETH deposits and withdrawals will be enabled again once the winning chain has become clearly evident.
Some interpreted this statement to mean that we would not grant access to balances on the non-dominant chain under any circumstance but this was never our intention. The statement was written from the standpoint of a “winner take all” scenario where the non-dominant chain dies out fairly quickly. Since the outcome of the fork may be more complicated than this, we want to make a number clarifications here and assure everyone that we are making preparations to be ready for any outcome of the fork and will act accordingly.
How long will it take? Although the process may go smoothly and quickly, we want everyone to understand that we will be very cautious about waiting for a clearly dominant chain (with the most work on it) to emerge before enabling ETH and DAO funding again. We think this is unlikely, but depending on how things go, we may have to wait several days or more to be safe. You should not send any Ethereum or DAO deposits to Kraken until we have enable deposits. You can follow us on twitter (https://twitter.com/krakenfx) or our status page (https://status.kraken.com/) to learn when funding is enabled again.
Are my funds safe with Kraken? Yes. We are taking steps to ensure that Kraken balances on both chains are secure against any replay attack. You can read more about the replay attack here:
There are other ways to protect against the attack, but this guide has been at least partially endorsed by Ethereum co-creator Vitalik Buterin.
What about my private wallets? Everyone should update their Ethereum client to Geth v1.4.10. Please be very cautious with your private Ethereum wallets and do not send any transactions during the fork to Kraken or anywhere else. Even after the fork you should be careful and understand the danger of the replay attack. If you only care about your funds on the dominant chain, then you do not need to worry about the replay attack.
But if you care about funds on both chains then you will need to take precautions against the replay attack. Unfortunately, aside from the highly technical guide linked above there isn’t a comprehensive guide for more ordinary users on how to protect yourself. But here is one place with some tips and discussion that is aimed at a somewhat less technical level:
Hopefully a better guide to navigating the fork with your private wallet will be available soon on https://blog.ethereum.org/ or elsewhere.
Will Kraken offer markets for the non-dominant chain? While we haven’t ruled this possibility out, we do not at the present time intend to offer trading markets for the non-dominant chain. In our view it could possibly take several weeks or more before it would even be safe to do this.
What about margin positions? We highly recommend that margin positions be closed before the hard fork starts since the fork may bring a lot of unpredictable volatility or other unusual market behavior making margin trading much riskier than normal. Depending on how the fork resolves, in order to manage the overall exchange risk, we may need at some point to do at least a partial forced closure of margin positions. This means that margin traders may possibly experience at least a partial forced closure of their positions. We will make every effort to minimize the impact and only close positions to the degree that seems necessary, but we cannot guarantee that our decision will be ideal for everyone. We do not think this scenario is very likely, but nonetheless want to let our traders know about the possibility so they can make more informed trading decisions heading into the fork. Margin traders who are uncomfortable with this possibility should close their positions prior to the start of the fork.
What about The DAO? Caution should be exercised for all Ethereum blockchain operations during the fork, including DAO and any other Ethereum based tokens. DAO funding on Kraken will be offline during the fork and you should not send DAO transfers to Kraken or anywhere else during the fork. DAO transfers are also vulnerable to the replay attack discussed above, so you should be cautious about sending DAO transfers even after the fork.
Today Kraken set a new trade volume record with nearly 100,000 BTC in 24 hour volume traded across all currency pairs. The new record marks a 264% increase over the last record, set on November 3rd 2015, when over 37,600 BTC were traded. Kraken has doubled previous volume records four times since October 2014. This means that we are exceeding previous volume records by 2x or more about every five months on average - a rate of growth we are very proud of!
Less than six months after acquiring both Coinsetter and Cavirtex in a landmark deal, we are pleased today to announce the acquisition of CleverCoin, one of the first Netherlands-based bitcoin exchanges. The addition of CleverCoin cements Kraken’s position as the undisputed leading exchange in Europe with the arrival of thousands of new clients, while other geographic markets experience record growth. Terms of the deal were not announced.
In the announcement, CEO Jesse Powell described plans to fold the CleverCoin brand into Kraken’s global umbrella while providing existing clients with seamless access to Kraken’s unparalleled suite of features. CleverCoin clients will be automatically transferred to Kraken’s platform on June 29, 2016. Once the transfer is completed, account holders will be directed to www.kraken.com to login, update account information, and can begin trading immediately.
Founded in 2013 as one of the first bitcoin exchange in the Netherlands, Eindhoven-based CleverCoin is a graduate of Boost VC, the high profile accelerator backed by venture capitalists Tim and Adam Draper. CleverCoin was one of the earliest exchanges in Western Europe to focus on compliance, offer leveraged trading, and establish regulated banking partnerships. After successfully selling the most prominent Dutch bitcoin exchange, CleverCoin’s founders have decided to focus on providing IT business solutions.
CTO and Co-Founder Karsten Nilsen said, “Kraken is the ideal custodian for CleverCoin going forward. They are, by every measure, the largest bitcoin and digital asset exchange in Europe and our core beliefs are perfectly aligned. As of today, CleverCoin clients will have seamless access to all the features and benefits of Kraken’s global brand, including the ability to trade many of the most popular currency pairs, the latest technology, the most advanced security, and faster Single Euro Payments Area (SEPA) transfers.”
Former CEO and Co-founder Christian de Kok added, “We started CleverCoin to provide access to bitcoin to traders throughout Europe, and today we could not be prouder of our accomplishments. Since 2013, we’ve helped tens of thousands of individuals trade bitcoin and have access to the fastest SEPA payments of any crypto exchange, rivaled only by Kraken. We are excited to hand the torch to our partners at Kraken.”
Reflecting on today’s news, Kraken CEO Jesse Powell said, “In record time, the digital currency industry has matured. Our M&A plans have been accelerated by encouraging news throughout the industry. Prices are rising, the regulatory picture is rapidly clarifying, and clients from around the globe are joining us in record numbers. The acquisition of CleverCoin will empower Kraken with greater liquidity and a significantly expanded customer base in Europe, our flagship market.”
Since the majority of CleverCoin clients are in European countries, the acquisition is expected to have the greatest impact on Kraken’s euro trading pairs. Average weekly volume in these pairs has already been growing at a rapid rate since the third week of April, with an over 4x increase in the bitcoin-euro (XBT/EUR) and ether-euro (ETH/EUR) pairs. The ether-bitcoin pair (ETH/XBT), has seen a massive 9x increase.
In the weeks following Kraken’s acquisition of prominent bitcoin exchanges Coinsetter and Cavirtex on January 19th, Kraken saw remarkable gains in average weekly trade volumes, including XBT/USD (13x increase), ETH/USD (30x increase), XBT/CAD (50x increase), and ETH/CAD (6x increase).
After acquiring Coinsetter and Cavirtex, in February, Kraken announced that SBI Investment, an influential Japanese venture fund, would lead a Series B round of financing. In April, Kraken announced an additional, significant investment from leading Japanese FX brokerage Money Partners Group to their Series B, and in May was selected by CME Group, one of the largest options and futures exchanges, to be a key supplier of market data for new reference and real-time bitcoin price indices. One of the first major exchanges to embrace Ethereum, Kraken last month unveiled the first-ever Ether Dark Pool and the addition of leveraged trading for ether with multiple currency pairs.
Kraken has received many requests from our clients and others in the community for assistance in disputing accepted or rejected amounts with MtGox claims.
Any claimants with remaining disputes must file an application for an appraisal of their bankruptcy claim with the Tokyo District Court. This is the only process for disputing MtGox claims.
Each creditor with a dispute must file their own appraisal application. To assist the community, Kraken is pleased to provide assistance that, to the best of our knowledge, may be helpful in filing the application. However, Kraken is not responsible for any potential inaccuracies in the provided information, and not responsible for any outcomes.
The best option for claimants would be to find a Japanese lawyer who can help fill out the application. However, according to the Japanese bankruptcy lawyers Kraken spoke with, the first stage of this filing for the claim assessment does not necessarily require a lawyer. Claimants may need an attorney to file a lawsuit.
First, claimants must officially alert the court that they desire their case reviewed before the deadline of June 27, 2016, Japan Standard Time. Kraken has created a template for claimants’ use, but it must be filled out in Japanese. It is the responsibility of claimants to find a Japanese speaker or a translation service to help with this process, as Kraken is not able to assist creditors in filling out this template.
Although in an ideal circumstance, a credentialed Japanese attorney can help, it may be adequate to find someone who can write proper Japanese to explain the situation and to provide necessary evidence.
Second, by the deadline on June 27, 2016 in Japan Standard Time, claimants must be sure to mail all required documents to the court. Claimants must mail two copies of the form and two copies of each evidence document (1 for the court, 1 for the trustee) to the Tokyo District Court.
The mailing address of Tokyo District Court can be found below:
The Section in charge of bankrupt entity MTGOX Co., Ltd. 20th Civil
Division of the Tokyo District Court 1-2 Kasumigaseki 1-chome
