Kraken considers Cyprus a reliable base for operating in the EU market
Cryptocurrency platform Kraken conducts its European derivatives business in Cyprus, regulated under the MiFID II directive. Stavros Vassiliades, Chief Operating and Executive Director of Payward Europe Digital Solutions (CY) Ltd, said the company considers the island a reliable base for international fintech groups operating in the EU market, Cyprus Mail reports.
According to Vassiliades, Kraken’s Cyprus investment company, regulated by the Cyprus Securities and Exchange Commission (CySEC), is the hub for the platform’s European derivatives business. Spot trading in cryptoassets in the EU is conducted through Kraken’s MiCA hub, authorized by the Central Bank of Ireland.
MiCA and MiFID II regulation
Vassiliades explained that MiCA establishes rules for cryptoasset services, including exchanges, asset custody and stablecoins. At the same time, MiFID II applies to financial instruments, including derivatives whose underlying asset is a cryptoasset. Companies offering both types of services need two licences.
Through its MiCA and MiFID divisions, Kraken can provide services in 30 countries of the European Economic Area. In Cyprus, the company works with products regulated by MiFID II, primarily futures, xStocks tokenized shares, as well as traditional shares.
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The Kraken representative cited regulatory certainty, the availability of compliance, anti-money laundering and risk management specialists, and CySEC’s experience in supervising complex financial products among Cyprus’s advantages. He also noted that the real presence of licensed companies is important for the country’s reputation: local management, control functions and decision-making on the island.
Risks and jobs
Vassiliades stressed that a licence does not guarantee investor protection against market losses. According to him, it means company supervision, capital and control requirements, segregation of client funds, and the possibility of holding a firm accountable. Before using a platform, he advised checking who regulates it, where client funds are held, and whether the legal entity on the registration page matches the one listed in the licence.
In Vassiliades’s view, the development of the regulated digital finance sector could create skilled jobs in Cyprus in compliance, AML, cybersecurity, technology, internal audit, law and risk management. Kraken plans to expand its operations on the island and cooperation with the local professional community.
