Real World Origin:
In Scandinavian mythology, the Kraken were enormous sea monsters known for sinking ships. The earliest stories described the Kraken as crab-like creatures with later tales changing them to huge octopuses or squid.
The Kraken became known in the English speaking world due to Alfred Tennyson's sonnet The Kraken:
Below the thunders of the upper deep,Movies such as Clash of the Titans, both the original and the 2010 version, featured a monster referred to as the Kraken, although these creatures are very different from traditional descriptions.
Far, far beneath in the abysmal sea,
His ancient, dreamless, uninvaded sleep
The Kraken sleepeth: faintest sunlights flee
About his shadowy sides; above him swell
Huge sponges of millennial growth and height;
And far away into the sickly light,
From many a wondrous grot and secret cell
Unnumber'd and enormous polypi
Winnow with giant arms the slumbering green.
There hath he lain for ages, and will lie
Battening upon huge sea-worms in his sleep,
Until the latter fire shall heat the deep;
Then once by man and angels to be seen,
In roaring he shall rise and on the surface die.
The Kraken portrayed in Pirates of the Caribbean: Dead Man's chest, closely matches traditional accounts, although the stories don't typically include supernatural elements such as Davy Jones.
Some believe that the legends of the Kraken originated from sightings of real animals like the Giant Squid or a hypothesized species of giant octopus.