Kraken Introduces Bitcoin Dark Pool to Tackle Flock Trading


Howard Bernstein, the financial compliance veteran, Joins Kraken as Chief Compliance Officer — Kraken today announced the launch of Bitcoin Dark Pool, a feature that is hopeful to limit the aftereffects of flock trading.

According to the details given, the new feature is a concealed order book in which only trader can see his order. This enables him to place anonymous orders, especially the ones carrying high value, without raising an alarm to other members of the exchange. Kraken believed that the outsized orders influence the market to move unfavorably, which typically makes it difficult for traders to fill the order at the desired price.

“This unfavorable price movement may be avoided in a dark pool,” the San Francisco exchange concluded.

Limited Fluctuations

The first and the foremost expected result to come out of Kraken Bitcoin Dark Pool is limited price fluctuations. Hiding big supply/demand orders from the regular market will simply eliminate psychological buyouts and sell-offs that, until now, used to cause too much manipulations in the Bitcoin market.

Overall, the traders will behave more natural than influenced. Kraken, being one of the world’s largest Bitcoin exchanges, would sincerely do its bit to control price volatility, as we expect.

Service Ain’t Free 

Kraken has however decided to charge a nominal 0.1% for dark orders. While, the service will be available only to users whose accounts are verified to Tier 2 or higher. The blog further added:

“The minimum dark order size is 50 bitcoins and only limit orders are supported. The dark pool will accept orders for trading between bitcoins and EUR, USD, JPY or GBP. Dark pool pairings are designated by a “.d” extension (e.g. XBT/EUR.d or XBT/USD.d).”