After years of heavy reliance on transaction fees, crypto exchanges appear to be experimenting with subscription models with the possibility of a shift towards a more predictable business model.
Cryptocurrency exchanges are no longer a place to buy and sell cryptocurrency. As trading volumes remain unstable (and sometimes swing within hours), platforms like Kraken and Coinbase are turning to subscription models in search of more stable revenue.
For many years, crypto traders have expanded their range of services, from decentralized platforms and staking products to the NFT market, lending capabilities and peer-to-peer tools. However, most of them still rely on users who have decided to trade with impulses, making it difficult to predict revenue.
Rather than relying solely on trading fees, exchanges are now looking for ways to generate more stable income and provide a more consistent experience. Pauline Shangett, Chief Marketing Officer at Changenow, said in an interview with Crypto.News that exchanges and similar services “need new revenue streams and require stable and predictable.”
“It complicates financial and strategic planning when all revenues rely on market revenues that can plummet or surge dramatically based on news and circumstances. For example, not all exchanges survived past “Crypto Winters” because they actively expanded their staff and marketing budgets without creating a financial safety net. ”
Pauline Shangett
Shangett said that the subscription model and services, where demand is not directly dependent on the stage of the market, “enables companies to better plan for the future, reduce risk and engage in long-term projects, and ultimately provide a higher level of service to their customers.”
“Changenow and now Wallets also offer subscription options that provide more favorable terms, special offers and access to additional services. For example, subscribers can perform AML checks to freely verify their own and counterparty addresses for suspicious funds. Overall, this model is beneficial for both the exchange and its clients.”
Pauline Shangett
“It’s designed to provide real value.”
Kraken is the latest to join the trend and introduces Kraken+. Kraken+ is a premium membership offering zero-fee trading and boosts rewards at $4.99 a month. According to a press release, Kraken+ will allow you to trade up to $10,000 per month for instant purchases via the main app at no charge. Subscribers will also win up to 4% APR at USDG held on the exchange.
In an interview with Crypto.News, Kraken’s global consumer director Mark Greenberg said the launch of Kraken+ came as a “direct response to what we hear from our clients.”
“People want more utilities from trustworthy platforms. We’ve increased the way we save, store and grow our possessions without having to jump over the hoops. We’ve built kraken+ to reward that trust. For a small fee, our clients get meaningful and everyday benefits like unpaid transactions and stable profits – everything is designed to provide one streamlined experience.
Mark Greenburg
Technically speaking, Kraken follows in the footsteps of Coinbase, which launched a similar product in 2023. CoinbaseOne offers fee-free transactions, prioritization support and other perks. The premium version of Coinbase One Premium will return 25% to unlimited Zero-Fee Trading, Coinbase Advanced Spot Fees, for increased rewards.
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Profitable business
It may be too early to measure long-term profitability, but Coinbase had previously reported strong momentum. In a shareholder’s letter in February, the company said its subscription and service revenues reached $2.3 billion in 2024, up 64% year-on-year, more than four times the 2021 Bull Run.
“Coinbase One subscribers grew in each quarter of 2024 as they expanded both account benefits and geographic availability throughout the year.
Coinbase
By the end of 2024, the number of Coinbase One subscribers exceeded 600,000, up 50% from the first quarter of 2024, according to Coinbase. Greenberg told Crypto.News that Kraken is hoping for a “strong adoption” of its latest product and plans to expand further in the future
“It’s a way to continue evolving based on client feedback, not just what’s included at launch. Our goal is to make Kraken+ the most rewarding way to get involved with Crypto in the long run.”
Mark Greenburg
As competition between exchanges increases, subscription products may represent a more sustainable path to advancement. It is still unclear whether these programs will provide lasting value to users and the platform. Still, Greenberg frames subscriptions as a matter of trust, and Kraken says it aims to build a platform that “people want to stay for long-term travel, not just products.”
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