Cryptocurrency exchange Kraken has announced the acquisition of Small Exchange, a licensed derivatives market (DCM) authorised by the US Commodity Futures Trading Commission (CFTC). The deal is valued at $100 million.
This strategic acquisition will enable Kraken to launch a full range of derivative financial instruments in the regulated US market. Small Exchange holds a DCM license, which grants it the right to develop and create exchange-traded derivatives under US law.
According to the company, the integration of Small Exchange is in line with Kraken’s intention to create a unified, high-performance trading environment. The new platform is expected to provide deeper liquidity and expand investor access to regulated products.
Expanding presence in the US
The acquisition of Small Exchange is another step by Kraken to expand its presence in the US derivatives market. Earlier in 2025, the company acquired NinjaTrader, a leading US futures platform. That allowed US customers to trade cryptocurrency futures listed on the Chicago Mercantile Exchange (CME) alongside spot assets in a single interface.
In October, Kraken expanded its product line by adding contracts for stocks, currency indices, and commodities, including oil and gold. According to the company’s official website, these initiatives reflect the company’s strategic focus on developing a regulated trading infrastructure.
The foundation for a new generation of event-driven trading
According to Arjun Seth, co-CEO of Kraken, the acquisition of a licensed DCM market supervised by the CFTC lays the foundation for a new generation of derivatives markets in the country.
The integration of DCM allows Kraken to combine spot, futures, and margin products within a single regulated liquidity system. This solution reduces fragmentation, cuts funding delays, and provides access to trading opportunities that were previously available primarily on foreign exchanges.
Under CFTC oversight, the company will be able to integrate clearing, risk management, and trade matching processes into a single environment that meets the standards of the world’s leading exchanges.
Building a global infrastructure
The acquisition of Small Exchange is part of Kraken’s larger project to build a global infrastructure for trading derivative financial instruments. Today, the company is offering derivatives in key financial jurisdictions: the UK, the European Union, and the US.
The unified system covers six fiat currencies and more than 450 digital and traditional assets, operating within a single architecture. This structure allows for risk balancing between regions and reduces capital costs, which previously limited the opportunities for US traders.
According to Kraken representatives, this is not a marketing approach, but rather the creation of a sustainable and effective market model that meets the requirements of institutional investors and international regulators. Having secured the necessary licenses and technological base, the company is adapting markets to the development of the cryptocurrency industry.
Severe competition and rapid development
Competition in prediction markets is growing in proportion to global demand for them. In October, Kraken’s future competitor, the Kalshi prediction platform, raised $300 million in a Series D investment round. The company’s valuation has grown to $5 billion, more than doubling in the last four months.
Kalshi has already expanded access to its platform to users in 140 countries. The company positions itself as the first global prediction market with uniform trading conditions. Foreign customers now trade on the same terms as American customers, with no changes to the product.
Kalshi’s round followed Polymarket’s $2 billion deal with Intercontinental Exchange (ICE), after which the exchange’s valuation reached $9 billion. Both events took place within a few weeks of each other and attracted the attention of major financial institutions.
Prediction markets are entering a phase of active growth. The question now is not about their future, but about the speed of their development. Ireland, New Zealand, Singapore, Switzerland, Hong Kong, Germany, and the Netherlands are among the countries where prediction markets are permitted, subject to local regulatory requirements. Experts predict that this list will grow in the coming months.
This article was first published in Russian on 20 October 2025.
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