Kraken Cuts 150 Jobs via AI as $20 Billion IPO Hangs in Balance

Payward, Kraken's parent company, eliminated 150 positions on May 15, representing 5% of its 3,000-person workforce. The stated reason: artificial intelligence has made certain operational roles redundant. The timing is striking. Kraken spent $2.65 billion on acquisitions over the past eight months, and is now cutting staff because automated tools have replaced functions that humans used to perform. The contradiction is hard to ignore.

$2.65 Billion in Acquisitions, Fewer Employees: Payward's Logic

Since January 2025, Payward has acquired eight companies. The three largest, according to Bloomberg and CoinDesk: NinjaTrader (a U.S. futures platform with CFTC licensing) for $1.5 billion, Bitnomial (regulated digital derivatives) for $550 million, and Reap Technologies (stablecoin payments) for $600 million. Combined: $2.65 billion. Over the same period, headcount shrank. In October 2024, Payward cut around 400 employees, roughly 15% of staff. This week, another 150. In eighteen months, Payward has reduced its workforce by nearly 550 people.

The strategy has an internal coherence. Acquisitions expand regulatory licenses and geographic reach. Cuts improve margins. The expected result is a leaner, more profitable company that looks attractive to public market investors. Kraken posted $648 million in revenue in Q3 2025, its best quarter on record, according to company filings. Since then, market conditions have softened and the company has adjusted accordingly.

Key figures

• Jobs cut (May 15, 2026): 150 (5% of 3,000)
• Total cuts since October 2024: approximately 550 employees
• Acquisitions 2025-2026: $2.65 billion (8 deals)
• April 2026 funding round valuation: $13.3 billion
• IPO target valuation: $20 billion
• Confidential SEC S-1 filing: November 19, 2025

Payward: Acquisitions by Value (USD billions)

Why Is Kraken Cutting Jobs Before Its IPO?

Functionally, the official explanation, cited by Bloomberg via an anonymous source, is that AI has rendered certain operational roles unnecessary. Payward has deployed automated tools across specific functions and says it does not expect further layoffs at this time. The less official answer is more direct. Companies preparing for a public offering need to demonstrate cost discipline. Every improvement in EBITDA carries roughly double the weight in market valuation.

Payward filed a confidential S-1 with the SEC on November 19, 2025. The company then paused its IPO plans in March 2026, citing unfavorable market conditions. The April funding round valued Payward at $13.3 billion, down 33% from its late-2025 peak, per Bloomberg. Deutsche Boerse invested $200 million for a 1.5% stake as part of a strategic agreement announced in December 2025. At Consensus Miami, co-CEO Arjun Sethi stated that Kraken is “80% ready” to go public. Bloomberg's current read puts the listing as far out as 2027.

For European investors and MiCA-compliant users who rely on Kraken for DAC8 reporting obligations, a listing changes little in the immediate term. Longer term, a publicly traded Kraken answers to shareholders: pressure on margins frequently translates into higher retail fees down the line.

AI and Crypto Exchanges: A Shift Already Underway

Kraken didn't invent this playbook. AI agents are already operating autonomously on exchanges such as Hyperliquid, executing orders without human input. According to McKinsey, the firm has integrated 25,000 digital agents into its own operations. JPMorgan has deployed them across 250,000 employees. The crypto sector moves faster because its operations are already fully digital.

Customer support, on-chain monitoring, security alerts, risk analysis. These are all functions that a trained model handles better, faster, and at near-zero marginal cost. The Alpha Arena experiment has already shown that AI models outperform human traders in live perpetuals markets. What's happening inside exchanges is the same process. Less visible, though.

The key metric to watch is the gap between the April valuation of $13.3 billion and the stated $20 billion IPO target: a $6.7 billion gap the market must close before Payward returns to the listing window. The Clarity Act offers a concrete catalyst: if the Senate secures 60 votes before the May 21 recess, the U.S. regulatory framework shifts and institutional appetite for listed crypto exchanges could reopen as early as this summer. Without that vote, Bloomberg's 2027 estimate becomes the baseline. Also worth watching: the April 2026 data extortion case involving 2,000 exposed accounts. No customer funds were at risk, but it's the kind of incident a pre-IPO company would rather not have on its record.