Kraken enters the proprietary trading field through the acquisition of Breakout, a startup based in Tampa, Florida, that provides funding support for traders.
In a Thursday announcement, the cryptocurrency exchange Kraken announced the acquisition of Breakout, a startup that offers traders funding of up to $200,000 through a "rigorous assessment" method that tests risk management and strategy discipline.
Kraken co-CEO Arjun Sethi stated in a statement, "Breakout provides us with a way to allocate capital based on skill proof rather than the acquisition of funds itself… We want to build a system that rewards proven performance rather than background."
Proprietary trading, or prop trading, refers to traders using company funds rather than their own to trade, with both parties sharing the profits. The company stated that traders on the Breakout platform can retain up to 90% of their profits.
The platform launched in 2023, supporting over 50 cryptocurrency trading pairs, including leveraged contracts for Bitcoin (BTC) and Ethereum (ETH).
The financial terms of the transaction were not disclosed. Breakout raised $4.5 million in seed funding in 2024 and will ultimately be integrated into Kraken Pro as part of the exchange's entry into trading infrastructure.
This move also follows Kraken's acquisition of the U.S. futures and trading software platform NinjaTrader for $1.5 billion in May 2025.
After the 2008 financial crisis, U.S. banks were restricted from engaging in proprietary trading, pushing activities toward independent market makers and companies like Citadel Securities, Jane Street, and Jump Trading.
Proprietary trading has also taken root in the cryptocurrency space. Companies like Jump Crypto, a subsidiary of Jump Trading, and Cumberland, a division of DRW, deploy their own capital in digital assets, including through market-making activities. Meanwhile, retail-focused platforms like Crypto Fund Trader, HyroTrader, and Breakout offer assessment-based accounts that allow traders to access funding.
Cryptocurrency exchanges have been acquiring companies and products to expand their traditional financial tool offerings.
In May, Coinbase completed a $2.9 billion acquisition of the derivatives exchange Deribit. This is one of the largest mergers in the industry to date, providing Coinbase with a significant foothold in derivatives trading.
In the same month, Crypto.com received approval from Cypriot regulators after acquiring A.N. Allnew Investments Ltd. This move granted it a MiFID license to offer regulated securities and derivatives in the European Economic Area.
On Tuesday, Japanese cryptocurrency exchange Coincheck announced plans to acquire Aplo, a regulated digital asset broker based in Paris. This transaction provides Coincheck with a foothold in the regulated market in Europe.
Related: Opinion: Why DeFi gold products are underperforming compared to traditional finance?
Original article: “Kraken enters proprietary trading with Breakout acquisition”
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