Kraken Reports Criminal Extortion Attempt Involving Insider Recruitment

Global digital asset exchange Kraken is being extorted by a criminal group that is threatening to release videos of the company’s internal systems with client data shown if the firm does not comply with the group’s demands, Kraken Chief Security Officer Nick Percoco said in a Monday (April 13) post on X, which was reposted by the Kraken account.

“It’s important to start with the most important points: our systems were never breached; funds were never at risk; we will not pay these criminals; we will not ever negotiate with bad actors,” Percoco said in the post.

The videos the criminal group is threatening to release were taken during two instances of inappropriate access to a limited amount of Kraken’s client support data, according to the post.

Both instances were identified and shut down by Kraken, one in February 2025 and the other more recently, the post said. In one case, Kraken identified the individual involved as a member of its support team. In both cases, the firm revoked the individuals’ access, conducted an investigation and notified the limited number of affected clients.

Kraken also put additional security controls in place and has been collaborating with industry partners and law enforcement to investigate and disrupt insider recruitment efforts targeting crypto, gaming and telecommunications organizations, per the post.

Across both incidents, the total number of client accounts that may have been viewed was about 2,000, or 0.02% of Kraken’s clients, according to the post.

Kraken began receiving extortion demands shortly after terminating the access of the individuals involved in the incidents, the post said.

The company believes there is sufficient evidence to support the identification and arrest of those responsible, and it is working with federal law enforcement to bring all individuals to justice, per the post.

“The security of our clients is our highest priority, and we remain fully committed to combating the growing global threat of insider recruitment and constantly enhancing our security practices to combat new threats,” Percoco said in his post. “Note: If you are a client potentially affected by this, you’ve already been notified.”

PYMNTS reported in 2024 that one of the biggest fraud threats facing enterprises is insider fraud. Today’s employees enjoy unprecedented access to sensitive data and financial assets, and this newfound accessibility has opened the door wider to potential insider threats.