Criminals Blackmail Kraken With Alleged Client Data Leak

Kraken is facing an extortion attempt after uncovering two insider incidents involving support staff access to limited client data.

The exchange’s Chief Security Officer, Nick Percoco, insists its systems and funds were never compromised.

Kraken Insider Extortion Case Exposes Growing Support Staff Security Risks

Crypto exchange Kraken disclosed two separate incidents of insider access involving support staff who viewed limited client data, which later prompted an extortion attempt by a criminal group.

The firm’s CSO says no systems were breached and funds remained secure after acting immediately on each alert. Support access was revoked quickly in both cases, according to the Kraken security update statement.

“We are currently being extorted by a criminal group threatening to release videos of our internal systems with client data shown if we do not comply with their demands,” Percoco wrote in a post.

According to the company, only about 2,000 client accounts, roughly 0.02% of its user base, may have been viewed during the incidents.

Notifications were sent to affected users. Kraken says the exposure was limited to support systems, not trading infrastructure, and no funds were affected.

Kraken Rejects Extortion Demand

The incidents escalated when a criminal group began demanding payment, threatening to release internal videos and data unless Kraken complied.

Reportedly, Kraken refused, stating it would not negotiate with bad actors. The exchange confirmed it is working with law enforcement across jurisdictions and has gathered sufficient evidence for identification efforts.

“We are actively working with federal law enforcement across multiple jurisdictions to pursue all individuals involved and bring them to justice,” he added.

The case reflects a wider industry issue involving attempts to recruit or bribe customer support employees at crypto and tech firms.

It mirrors Coinbase’s 2025 case, where bribed overseas agents leaked customer information. In both, no systems were breached, client funds remained safe, and the exchanges refused extortion demands while cooperating with law enforcement.

Security teams across the sector have increased monitoring and access controls in response. Similar tactics have been observed in the gaming and telecom sectors, according to industry reports.

Notwithstanding, some users question offshore support hiring practices, arguing that geography influences security risk perception.

“Why don’t you hire people from developed countries? I won’t put my money on a platform that I have to hope for their third world support staff to not get bribed by criminals to expose my data. Banks don’t hire support staff in third world countries either,” one user expressed.

Kraken has not commented on those claims but emphasized access controls over location as the primary safeguard.

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