Kraken, Equinix Offer Colocation for Lower-Latency Trading

Kraken and Equinix announced a colocation service that lets traders place servers in Equinix data centers located next to Kraken's matching engines. The companies say the setup shortens the path between order entry and execution.

Equinix will house clients' racks, provide power, cross-connects and physical security, and give access to its network and cloud ecosystem. Kraken will provide technical specifications and connectivity options for colocated clients to attach to its trading environment.

By positioning hardware in facilities that host or peer with Kraken's production systems, traders can reduce round-trip times by milliseconds. That latency reduction can be relevant for high-frequency strategies that depend on fast order placement.

The service targets high-frequency traders, market makers and institutional firms that run latency-sensitive systems and prefer controlling their own hardware instead of relying only on remote cloud instances. Colocation is common in traditional equity and futures markets and is now available for Kraken's crypto trading venues.

Clients using the colocation service remain subject to Kraken's API and trading rules, including risk controls, order rate limits and compliance checks. Customers are responsible for equipment installation, maintenance and software configuration; Equinix handles rack space, power delivery and physical security.

Kraken and Equinix cited Equinix's global network of interconnected data centers and Kraken's matching infrastructure as the basis for the offering. Users who do not require colocation will continue to access the exchange through existing network routes and cloud providers.

In a joint statement, the firms described the service as providing ‘predictable, low-latency connectivity' for market participants seeking consistent access to Kraken's markets.

Exchanges and data-center operators commonly pair colocation with direct-market access options, dedicated cross-connects and network monitoring to help customers manage performance.