# Kraken (Payward): how the business works, Q2 2026 results, and the road to going public > How Kraken's business works, its Q2 2026 results, and the current status of its path to going public, for investors. Last modified: 2026-08-17T19:53:00.000Z Canonical: https://wiki.private.law/en/kraken-payward-ipo Topics: investments Jurisdictions: usa, global Product tags: crypto, investment Semantic tags: crypto, investment --- Kraken \(the company's legal name is Payward Inc.\) is one of the oldest and largest cryptocurrency trading platforms in the world. It is the second most significant candidate for going public in this industry, after Coinbase, and one of the most anticipated crypto listings of 2026–2027. The company filed paperwork to go public \(a registration statement, Form S-1\) with the U.S. securities regulator \(the SEC\) in November 2025, but has twice delayed the actual stock sale because of unstable market conditions. During this time, the company's private valuation fell from $20 billion \(November 2025\) to $13.3 billion \(April 2026\), then rose again after a new round of fundraising. Despite this, the business itself is performing well: revenue for the second quarter of 2026 was $508 million, up 17% from a year earlier, even though the overall cryptocurrency market fell by about 37% over the same period. The share of revenue not directly tied to cryptocurrency trading grew from 23% to 42% over the year. For [Private.law](http://private.law/) clients, this is interesting as an example of gaining exposure to the convergence of traditional finance and cryptocurrency before the company goes public — with the caveat that access to such investments is usually limited to accredited and institutional investors, and the listing date remains uncertain. > **About the data in this article:** the sections on the public listing, licenses, and acquisitions are based on public sources — news reports and market data — and are unverified private estimates, not an official audit. The section on second-quarter 2026 financial results is based on figures the company itself disclosed to investors. This article is for informational purposes and is not investment advice. ## What Kraken is, and why it matters to investors Kraken was founded in 2011 by Jesse Powell. It is one of the oldest cryptocurrency trading platforms still operating today, having survived several severe market downturns and the collapse of competitors, including the FTX exchange. The brand's parent company is Payward Inc., headquartered in San Francisco. The company serves more than 10 million clients worldwide. Among major U.S. cryptocurrency trading platforms, only Coinbase has already gone public, listing in 2021. Kraken is positioning itself as the second major company of this kind to do so. ## The road to going public: what has happened so far The dates below show how dependent the listing decision is on market conditions: the process has already been paused twice after starting. | Date | What happened | | --- | --- | | September 2025 | The company raised $800 million from investors \(Jane Street, DRW Venture Capital, Tribe Capital\); separately, Citadel Securities invested $200 million at a $20 billion valuation | | November 19, 2025 | The company confidentially filed paperwork to go public with the SEC | | March 2026 | The company paused its listing plans because of poor market conditions | | April 2026 | Co-CEO Arjun Sethi confirmed the listing plans remained in place; Deutsche Börse bought $200 million of shares at a $13.3 billion valuation | | May 2026 | A new fundraising round at a $20 billion valuation — intended to fund acquisitions and prepare for the listing | | May 2026 | Bloomberg reported the listing could slip to 2027; the company cut about 150 staff as it rolled out artificial intelligence tools | | August 14, 2026 | The company published its second-quarter 2026 results; no new listing date has been announced | Filing confidentially lets a company go through the regulator's review process without disclosing its finances publicly. That's why, until it actually goes public, the company discloses financial data only voluntarily — for example, during calls with investors \([Private.law](http://private.law/)'s team took part in one such call\). ## How the business works: from an exchange to financial infrastructure Management describes Kraken not as a set of separate products, but as one shared technology platform — with a shared trade-matching system, a shared risk-management system, and a shared settlement system. Four business lines are built on top of this platform: | Business line | What it does | Main products | | --- | --- | --- | | **Payward Trading** | Trading cryptocurrency and other assets | Buying and selling at current prices, futures contracts, leveraged trading, stocks, the company's own proprietary trading, access through software interfaces \(APIs\) | | **Payward Banking** | Holding money and assets, banking services | Asset custody, payments, lending, services for wealthy clients | | **Payward Asset Management** | Managing clients' money | Private lending, venture investments, ready-made investment products, listing new assets | | **Payward Services** | Selling its technology to other companies | Software interfaces for banks, brokers and fintech startups, converting assets into digital form \(tokenization\), market data and benchmarking | A shared technology platform does not mean client money and risk are pooled together: client assets remain separated by country and by license type. Payward Services essentially sells the same technology that powers Kraken itself to outside companies, including competitors. This also includes a partnership with Nasdaq to convert stocks and exchange-traded funds into digital form. ## Second-quarter 2026 financial results The last column in the table below should be read separately from the rest: in May 2026 the company cut costs, but the effect only became visible in the numbers toward the end of the quarter. So the company's June run-rate — its pace of business in June, projected over a full year — is a better picture of its current state than the quarter's average result. | Metric | Q2 2025 | Q1 2026 | Q2 2026 | June run-rate | | --- | --- | --- | --- | --- | | Trading-based revenue | $197M | $217M | $202M | $223M | | Asset-based and other revenue | $237M | $290M | $305M | $310M | | **Total adjusted revenue** | **$433M** | **$506M** | **$508M** | **$532M** | | Gross profit | $322M \(74.2%\) | $393M \(77.6%\) | $385M \(75.9%\) | $417M \(78.3%\) | | **Adjusted earnings before interest, taxes, depreciation and amortization \(EBITDA\)** | **$80M** | **$18M** | **$23M** | **$67M** | | This profit as a share of revenue | 18.5% | 3.5% | 4.5% | 12.6% | Other notable figures for the quarter: the number of clients with a funded account grew to 6.6 million, up 42% from a year earlier; the real value of client assets on the platform grew to $65 billion, up 48%; the average number of daily futures trades reached 985,000, up 8%. The share of asset-based and other revenue in total revenue grew to 60%, up 5.6 percentage points from a year earlier. Total transaction volume on the platform fell 13% to $310 billion, but that didn't stop revenue from growing — because the company increasingly earns money from holding assets and related services, not only from trades. In May 2026 the company cut around $300 million in annual costs, through artificial intelligence tools and staff reductions. The effect is visible only in the June figures: the profit margin in June was 12.6%, compared with an average of 4.5% for the full quarter. ## Why revenue has held up despite the drop in the cryptocurrency market Over the past 12 months, the total value of all cryptocurrencies fell 37–40% from its peak in the third quarter of 2025. But Kraken's revenue stayed in the $508–653 million range per quarter throughout this period. The share of revenue not directly tied to cryptocurrency grew from 23% \(Q2 2025\) to 42% \(Q2 2026\). Compared with Q2 2025 levels, revenue from lines not tied to cryptocurrency grew 115%, while revenue from cryptocurrency trading fell 12% — for a net revenue increase of 17%. Cryptocurrency trading, the most volatile part of the business, declined, but the loss was more than offset by growth in the other business lines. Meanwhile, Kraken's share of the direct cryptocurrency trading market reached a record 5.5% in June 2026, even as the overall market for such trades shrank by 28%. ## Acquiring other companies Over 2025–2026, Payward spent more than $2.6 billion buying other companies: | Company | Deal size | Closed | Why it was bought | | --- | --- | --- | --- | | **NinjaTrader** | $1.5B | 2025 | A U.S. platform for retail futures trading that already held the license needed from the U.S. commodities regulator \(the CFTC\) | | **Bitnomial** | $550M | May 1, 2026 | Completed a full set of licenses for U.S. futures trading; the first products built on it launched within 60 days | | **Reap** | $600M | July 1, 2026 | Payment infrastructure built on stablecoins \(cryptocurrency pegged to ordinary money\) | Both 2026 deals were made at a $20 billion valuation — higher than the most recent publicly known valuation of $13.3 billion. The company points to how quickly it folds acquisitions into its operations: it typically takes only around 60 days from closing a deal to launching a new product built on the acquired technology. ## Plans for the second half of 2026 In a separate slide, management showed investors a list of priority products it plans to launch in the third and fourth quarters of 2026, across all four business lines. Two items stand out. The first is an application for a direct account with the U.S. Federal Reserve — a further step toward the fuller banking status discussed in the section on licenses and regulators. The second is an "IPO access" product under asset management, which is notable given that Kraken itself is preparing to go public at the same time. | Business line | Product | Quarter | | --- | --- | --- | | Trading | Crypto-backed lending for U.S. retail clients | Q3 | | Trading | AI-assisted trading | Q3 | | Trading | Updated program for new traders | Q3 | | Trading | Redesigned client website | Q3 | | Trading | Clearing as a service for professional market participants | Q4 | | Trading | Updated trade-matching system | Q4 | | Trading | Leveraged trading for U.S. clients | Q4 | | Banking | Debit card in the U.S. | Q3 | | Banking | Credit card in the U.S. | Q3 | | Banking | Virtual accounts for fast money transfers \(via the Fedwire system\) | Q4 | | Banking | Direct account with the U.S. Federal Reserve | Q4 | | Asset management | Client access to IPOs | Q3 | | Asset management | Partnership with Bitwise | Q3 | | Asset management | Ready-made investment products | Q3 | | Services for other companies | Futures contracts for European clients | Q3 | | Services for other companies | Partnership with Nasdaq | Q4 | | Services for other companies | Lending through decentralized finance services | Q4 | | Services for other companies | Futures contracts for U.S. clients | Q4 | | Services for other companies | Launch of digital versions of stocks in the EU, UK and Hong Kong | Q3 | | Services for other companies | Digital version of gold | Q4 | *A note from the company itself: as of the presentation, the Bitwise partnership was already live and expanding to other assets, including the Solana cryptocurrency; the company's own venture fund is expected to launch in August 2026.* This is an internal plan that management showed investors on a private call, not a public press release. Individual dates may shift, and some items — especially those planned for the fourth quarter — should be treated as preliminary rather than confirmed. ## Licenses and regulators The company holds more than 100 different licenses and registrations around the world. In the second quarter of 2026 it received new authorizations in the UAE and the British Virgin Islands, and applied for federal trust bank status in the U.S. through the OCC, a federal banking regulator. Kraken already holds a special type of U.S. bank charter — a full-reserve bank license issued by one U.S. state. This is a more limited status than an ordinary bank has. Management has said that, in certain countries, the company might eventually seek full bank status if that would allow more lending and similar products — but this remains a possibility, not a confirmed plan. For clients with substantial wealth who pay close attention to regulatory compliance, the breadth of the company's licenses is an important sign of its long-term stability. ## What this means for [Private.law](http://private.law/) clients **Access to shares before the listing.** Kraken is still a private company, so direct access to its shares is generally limited to accredited and institutional investors. Separate marketplaces exist for reselling such shares \(for example, Forge\), where the price has moved along with the company's new fundraising rounds — a good illustration of the main feature of this type of investment: low ability to sell quickly, and a price tied to the last funding round rather than to open market trading. **Comparable companies already publicly traded.** The closest public comparison to Kraken is Coinbase. Other companies with a similar business theme that are sometimes mentioned alongside it include Robinhood, Circle, Galaxy Digital and Strategy. **The core idea:** an investment in Kraken is an investment in a company building infrastructure for the convergence of traditional finance and cryptocurrency — not a direct bet on the price of any single cryptocurrency. ## Risks and open questions > ⚠️ > - **The company's valuation has swung sharply:** $20 billion → $13.3 billion → $20 billion again, all within 12 months > - **The listing date is uncertain:** the company has already delayed it twice, and no new date has been set > - **Dependence on the cryptocurrency market:** about 60% of revenue is still tied to cryptocurrency > - **Dependence on regulatory decisions:** possible regulatory changes after the 2026 U.S. midterm elections are a risk factor > - **Competition:** Coinbase, Robinhood and Binance are also actively expanding their own products > - **Limited verifiability of the data:** until it goes public, all figures come from the company's voluntary disclosures, without the independent audit required of already-public companies ## Conclusion and what to watch next > 🍓 Kraken is approaching its public listing with an unusual asset base for a cryptocurrency company: a wide range of licenses, revenue from diverse sources, active acquisitions of other companies, and a growing market share — all against a broader industry downturn. At the same time, the company has already delayed its listing twice, and its private valuation has swung sharply within a single year. > Clients considering exposure to Kraken, before or after it goes public, should watch: \(1\) an official announcement of a new listing date; \(2\) new fundraising rounds and changes in valuation; \(3\) whether growth in revenue from lines not tied to cryptocurrency continues; \(4\) further expansion of the company's licenses. > --- > **Important:** this material is written for informational purposes and is not investment, legal or tax advice. The company's private valuation, timeline and listing status can change quickly — the most current information should be checked before making any decision. --- ## Factual claims - Kraken was founded in 2011 by Jesse Powell. - The last column in the table below should be read separately from the rest: in May 2026 the company cut costs, but the effect only became visible in the numbers toward the end of the quarter. - In May 2026 the company cut around $300 million in annual costs, through artificial intelligence tools and staff reductions. - Over the past 12 months, the total value of all cryptocurrencies fell 37–40% from its peak in the third quarter of 2025. - Over 2025–2026, Payward spent more than $2.6 billion buying other companies: - Both 2026 deals were made at a $20 billion valuation — higher than the most recent publicly known valuation of $13.3 billion. - In a separate slide, management showed investors a list of priority products it plans to launch in the third and fourth quarters of 2026, across all four business lines. - A note from the company itself: as of the presentation, the Bitwise partnership was already live and expanding to other assets, including the Solana cryptocurrency; the company's own venture fund is expected to launch in August 2026.