In brief
- Kraken surveyed 1,000 crypto users in the U.S.
- Of the survey respondents, 79% said they would pay higher fees on an exchange they trust.
- Still, most users had accounts at multiple exchanges.
In an industry that prides itself on decentralization, a recent survey conducted by crypto exchange Kraken found that Americans are placing a premium on trust.
After surveying 1,000 crypto users in the U.S., Kraken found that 79% of them were willing to pay “slightly higher fees” when purchasing crypto through an exchange that they trust, as opposed to saving some cash by using one that they don’t.
According to Mark Greenberg, global head of consumer at Kraken, the data shows that crypto users in the U.S. aren’t chasing bottom-barrel fees default. Rather, the survey suggests that Americans are picking their venues through a multitude of factors, he told Decrypt.
“As the market matures, investors are showing they value long-term confidence over short-term savings,” he said. “People want to know their assets are safe, that the platform is reliable, and that they can access the tools they need without unnecessary complexity.”
Of the survey’s respondents, 16% said that “fees” were the most important factor for doing business on an exchange, while 26% identified “trustworthiness.” That was followed by “security features,” among 14% of American crypto users.
Although FTX was an international exchange, its collapse in 2022 affected domestic and foreign companies alike, creating an air of regulatory scrutiny that persisted into the final days of the Biden administration. In some ways, Kraken’s survey suggests that the public hasn’t forgotten that the exchange’s former CEO stole $8 billion worth of customers’ money.
Kraken is reportedly preparing to go public, and it’s unclear just how much the exchange relies on fees in terms of its bottom line. In the second quarter of this year, Coinbase disclosed that transaction revenue accounted for 53% of total revenue at $764 million.
Still, Kraken’s survey indicates that Americans aren’t too focused on regulatory compliance. Only 6% of respondents said that it was their top factor for choosing an exchange. That was the least common factor, followed by 7% citing “customer support.”
Kraken’s platform has faced critical bugs in the past, but its biggest competitor, Coinbase, suffered a massive data breach earlier this year. The misconduct, stemming from an alleged bribery scheme in India, is subject to a lawsuit. In disclosing the breach, Coinbase estimated initially that it could cost the exchange as much as $400 million
Most crypto users in the U.S. maintain accounts on multiple platforms, Kraken’s survey found. Around 44% said they used two exchanges, while 26% said they use more than that.
The respondents said that fees were a factor, yet a similar amount signaled that they use multiple accounts to gain greater access to digital asset listings, diversify platform risk, and keep their trading and long-term investing activity separate.
The dynamic likely captures the growing use of decentralized exchanges like Uniswap, which use smart contracts to allow people to trade assets without relying on intermediaries.
Last month, decentralized exchanges generated $478 million worth of trading volume, a 259% increase compared to $133 million a year ago, according to a Dune dashboard.
In fact, the competition between decentralized exchanges Hyperliquid and Astar has drawn considerable attention, with Binance co-founder Changpeng Zhao adding to the spectacle by vocalizing his support for the latter project built on BNB Network.
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