Kraken Institutional Unveils First Managed Yield Strategy with Bitwise
Kraken Institutional has announced the launch of its first bespoke investment answer, partnering with Bitwise Asset Management to offer eligible institutional clients access to a professionally managed yield strategy executed entirely within Kraken’s custody and trading infrastructure.
The debut product, called the Bitwise Custom Yield Strategy, represents Kraken’s first step toward building a broader suite of managed crypto investment answers. The move signals a shift in Kraken Institutional’s positioning, expanding beyond its traditional focus on custody and execution into curated investment strategies aimed at institutions viewking yield generation and operational simplicity.
The announcement also reflects a growing trend in the institutional crypto market: as BTC and other major digital assets mature into longer-term holdings for funds, family offices, and wealth managers, demand is increasing for yield-producing structures that do not require institutions to fragment custody, execution, and strategy management across multiple venues.
Bitwise manages the strategy while Kraken provides custody and oversight
Under the structure, Bitwise will act as the external strategy manager responsible for day-to-day portfolio management, while Kraken provides the qualified custody, execution, governance framework, and ongoing oversight.
The Bitwise team is led by Gordon Grant, Head of Derivatives at Bitwise, highlighting the derivatives-driven nature of the yield strategy. Kraken said the entire strategy will operate within its institutional-grade risk and operational framework, allowing clients to access managed exposure without moving assets off-platform.
This setup is designed to appeal to institutional allocators who prioritize operational control, counterparty transparency, and secure custody—areas where yield strategies in crypto have historically carried heightened reputational and risk concerns.
Kraken positioned the strategy as the first building block of a longer-term plan to provide a range of professionally managed offerings through a single institutional venue.
“Kraken is expanding beyond custody and execution to provide clients with access to professionally managed opportunities through a single, trusted venue,” said Gurpreet Oberoi, Head of Kraken Institutional. “This offering represents the first of multiple strategies as we build the infrastructure institutions need to access diverse crypto opportunities with confidence.”
Takeaway
Managed yield answers target a gap in institutional BTC portfolios
Kraken said many institutional crypto holders currently earn little or no yield on large BTC positions, despite increasing demand for yield generation as digital assets become more embedded in diversified portfolios.
While crypto yield strategies exist across the market, Kraken noted that access is often fragmented, forcing institutions to balance execution quality, custody risk, and operational complexity across multiple providers. The platform is positioning its managed answers framework as a way to consolidate these functions into a single venue with institutional-grade controls.
“Today, many institutional crypto holders earn little to no yield on assets such as BTC,” Kraken stated, adding that while strategies exist, the market remains operationally fragmented. Kraken said it is “uniquely positioned” to curate these offerings through its custody, liquidity, execution capabilities, client support, and regulated infrastructure.
The emphasis on qualified custody is notable, as yield strategies are often associated with asset rehypothecation or counterparty exposure. Kraken’s approach suggests it is attempting to deliver yield opportunities while keeping institutional investors anchored in a governance model designed to limit operational surprises.
Takeaway
Framework sets stage for multiple strategies and external managers
Kraken said the Bitwise Custom Yield Strategy is the first offering launched under a new managed answers framework, with additional strategies expected over time. The company stated that it plans to provide institutional clients with access to strategies managed by specialist external managers, alongside select Kraken-managed offerings.
This approach resembles the architecture of traditional prime brokerage and wealth platforms, where institutions can access multiple third-party managers while keeping custody and execution centralized. If Kraken can successfully scale this model, it may strengthen its role as a crypto-native institutional distribution platform rather than simply a trading venue.
Kraken also said that all strategies made available through Kraken Institutional will undergo a structured internal review and approval process, and will remain subject to ongoing oversight consistent with Kraken’s operating standards.
significantly for institutional liquidity management, Kraken noted that the initial strategy comes with minimal lock-up periods, offering flexibility for allocators who want yield without sacrificing the ability to reposition capital rapidly.
Takeaway
Bitwise strengthens institutional footprint through bespoke strategy partnership
For Bitwise, the partnership reinforces its positioning as one of the largest and most established crypto asset managers, expanding distribution through Kraken’s institutional client network.
Bitwise said it manages more than $15 billion in client assets and offers over 40 crypto investment products, spanning ETFs, separately managed accounts, private funds, hedge fund strategies, and staking answers. The company said it serves more than 5,000 private wealth teams, RIAs, family offices, and institutional investors, as well as 21 banks and broker-dealers.
The Bitwise Custom Yield Strategy delivered via Kraken Institutional adds another institutional distribution channel, potentially expanding the firm’s ability to deliver derivatives-based yield products in a controlled operational environment.
With demand growing for professional crypto investment structures that resemble traditional asset management products, Bitwise’s presence as an external manager may provide credibility to Kraken’s emerging managed answers strategy.
Takeaway
Kraken moves closer to prime brokerage-style institutional model
The announcement highlights Kraken’s broader ambition to become a full-stack institutional crypto platform. Kraken said it offers trading across more than 600 digital assets and also supports traditional asset access, including U.S. futures and U.S.-listed stocks and ETFs, alongside fiat currencies such as GBP, EUR, USD, CAD, CHF, and AUD.
By adding managed yield strategies, Kraken is moving further into a prime brokerage-style model where institutions can trade, custody, and allocate into investment answers through a single operational environment.
For institutional investors, this convergence may reduce operational complexity, lower friction in execution workflows, and improve governance oversight. For Kraken, it may represent a strategic evolution toward higher-margin institutional services that extend beyond pure transaction revenue.
With the Bitwise Custom Yield Strategy now live, Kraken Institutional appears to be laying the foundation for a more expansive institutional managed products platform—one that could play a larger role as crypto adoption becomes increasingly driven by traditional asset managers rather than retail speculation.
