Cryptocurrency exchange Kraken has started backing Cardano as collateral on its futures platform.
Along with Cardano, Kraken similarly supports crypto assets such as Chainlink, Polkadot, and Decentraland.
The native token of the Proof of staking platform, ADA, can now be used for cryptocurrency futures contracts. Kraken offers single collateral futures and multi collateral futures. Single collateral futures, as the name suggests, only allow users to use the underlying cryptocurrency of a particular pair as collateral. In multi-collateral futures, traders can deposit some cryptocurrencies as collateral. So this means that it is not limited to a single crypto. The ADA token is deducted by 10%. For example, if 1000 ADA is deposited, 900 ADA tokens are used to support the collateral.
The amount of the deduction differs according to cryptocurrencies. Although this rate is 0% in Bitcoin, it can go up to 50% in AVAX and XTZ.
Kraken launched its futures platform in 2019. It was licensed by the UK regulator in July 2020.
The company also paid a $1.25 million fine to the Commodity Futures Trading Commission (CFTC) for illegally offering margin crypto trading services in 2021.
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