Permitted Client, Accredited Investor and Eligible Investor Explained

In light of Canadian regulatory requirements, the availability of certain features and services offered on Kraken’s platform will depend on whether a Canadian client is a Permitted Client, an Accredited Investor or an Eligible Investor.

How will my status affect my access to certain Kraken features and services?

Trading limitsCanadian regulatory requirements limit net purchases of certain crypto assets over a rolling 12-month period. The applicable limits depend on whether you qualify as a Permitted Client, Accredited Client or Eligible Client.The limits do not apply to purchases of Bitcoin (BTC), Ether (ETH), Bitcoin Cash (BCH) or Litecoin (LTC).If you live in British Columbia, Manitoba, or Quebec, these limits do not apply to you. The limits are summarized below:

Permitted Clients and Accredited Investors will not be limited in the amount of crypto assets they can purchase.
Eligible Investors will be limited to a net purchase amount of CAD $100,000 in a rolling 12-month period.
All other clients will be limited to a net purchase amount of CAD $30,000 CAD in a rolling 12-month period.

Find out more information about trading limits here.

What are the requirements for Canadian clients to qualify as Permitted, Accredited or Eligible?

Canadian clients who do not have Intermediate or Pro accounts will first need to get verified to at least the Intermediate level before having the opportunity to certify as a Permitted Client, Accredited Investor or Eligible Investor. If you have previously certified as a Permitted Client, Accredited Investor or Eligible Investor, and your status has changed or you made an error in the certification process, please contact Support.

Permitted Client

The key ways to qualify as a Permitted Client are:

For a person*: You are required to beneficially own financial assets with an aggregate realizable value that, before taxes but net of any related liabilities, exceeds CAD $5 million. This test focuses on net financial assets (assets minus liabilities) as opposed to gross assets. Financial assets include, for example, cash, stocks, bonds, mutual funds and crypto assets. Financial assets do not include real estate. Beneficial ownership refers to financial assets that you own outright, as well as ownership through any trustee, legal representative, agent or any corporation or other legal entity which is wholly owned by you.
For a corporation: The company you represent must have net assets of at least CAD $25 million as shown on its most recently prepared financial statements. This test focuses on net assets (assets minus liabilities) as opposed to gross assets. Net assets include the value of real estate holdings, minus the amount of any mortgage or other indebtedness related to such real estate holdings. If you represent a company and the company doesn’t qualify as a Permitted Client under the CAD $25 million in net assets test, your company may qualify as a Permitted Client under one of the other categories of the Permitted Client definition. Please review the categories and contact Kraken support if the company you represent qualifies for at least one of them.

To see additional information on Institutional Qualification Requirements for Permitted Client Status, please see the following article. *A “person” is defined as: an individual, partnership, unincorporated association, unincorporated syndicate, unincorporated organization, trust, trustee, executor, administrator, or other legal representative.

Accredited Investor

The key ways for an individual to qualify as an Accredited Investor are:

Have a net income before taxes exceeding CAD $200,000 in each of the two most recent calendar years, or a net income before taxes combined with that of a spouse exceeding $300,000 in each of the two most recent calendar years, and reasonably expect to exceed that net income level in the current calendar year, or,
Beneficially own, alone or with a spouse, net assets of at least CAD $5 million, or,
Beneficially own, alone or with a spouse, financial assets with an aggregate realizable value that, before taxes but net of any related liabilities, exceeds CAD $1 million. This test focuses on net financial assets (assets minus liabilities) as opposed to gross assets. Financial assets include, for example, cash, stocks, bonds, mutual funds and crypto assets. Financial assets do not include real estate. Beneficial ownership refers to financial assets that you own outright, as well as ownership through any trustee, legal representative, agent or any corporation or other legal entity which is wholly owned by you.

The key ways for a corporation to qualify as an Accredited Investor are:

Meet one of the criteria listed in the following article to qualify as an Accredited Investor. Please review the categories and contact Kraken support if the company you represent qualifies for at least one of them.

Eligible Investor

The key ways to qualify as an Eligible Investor as a person are

Have a net income before taxes exceeding CAD $75,000 in each of the two most recent calendar years, or in the case of an individual, a net income before taxes combined with that of a spouse exceeding CAD $125,000 in each of the two most recent calendar years, and reasonably expect to exceed that net income level in the current calendar year, or
In the case of an individual, own, alone or with a spouse, net assets that exceed CAD $400,000.
For a corporation: Corporations cannot qualify as Eligible Investors

*A “person” is defined as: an individual, partnership, unincorporated association, unincorporated syndicate, unincorporated organization, trust, trustee, executor, administrator, or other legal representative.

Additional information on certification

As a Canadian client, it is your responsibility to understand the requirements to qualify as a Permitted Client, Accredited Investor or Eligible Investor under Canadian law. If you have any questions about whether you qualify, you should consult your legal advisor. Under the Terms of Service, you or the institution you represent is required to provide accurate and truthful information and promptly update your or its Kraken Account information. If you certify as a Permitted Client, Accredited Investor or Eligible Investor and your status changes or you certify on behalf of your institution and its status changes, you or your institution must notify Kraken promptly.

Please note: Your certification will be subject to review. If in our due diligence we require more information from you to verify your status, we will email you with further questions.