Coinbase Receives Regulatory Approval for Perpetual Futures Trading
Coinbase has obtained approval from the Bermuda Monetary Authority (BMA) to offer perpetual futures trading to retail traders outside of the United States. This move comes at a time when other cryptocurrency exchanges are facing increased regulatory scrutiny and withdrawing from certain regions. The global crypto derivatives market accounts for approximately 75% of worldwide crypto trading volume, indicating a strong demand for derivatives among traders.
Coinbase Advanced will begin to offer perpetual futures trading in the coming weeks, as access to regulated derivatives expands to more global customers. Check your eligibility at https://t.co/lJOJgQa3hk
— Coinbase International Exchange 🛡️ (@CoinbaseIntExch) September 28, 2023
Coinbase emphasizes that there are few authorized industry players offering this service, and even fewer that provide the necessary security and transparency for crypto traders to trade with confidence. In the second quarter alone, Coinbase’s perpetual futures contracts generated over $5.5 billion in notional trading volume from institutional investors.
Coinbase’s Global Expansion Strategy
In response to regulatory crackdowns by the Securities and Exchange Commission (SEC) in the US, Coinbase is expanding its operations outside of the country. As part of its “Go Broad, Go Deep” strategy, Coinbase is focusing on establishing operations in G20 member countries, Hong Kong, Switzerland, the United Arab Emirates, and Singapore.
A Rocky US Ground
While Coinbase continues to expand internationally, it is currently facing a lawsuit filed by the SEC alleging that it traded unregistered securities. However, Coinbase received approval from the National Futures Association (NFA) to offer perpetual futures to eligible institutional clients in the US, allowing the exchange to broaden its offerings and attract more customers.
Coinbase announced that Coinbase Financial Markets, Inc. has received regulatory approval from the National Futures Association (NFA) to operate a futures commission merchant (FCM) and provide eligible U.S. customers with cryptocurrency futures trading. Coinbase said its…
— Wu Blockchain (@WuBlockchain) August 16, 2023
Hot Take: Coinbase Expands Perpetual Futures Trading Amidst Regulatory Challenges
Coinbase’s approval to offer perpetual futures trading outside of the US demonstrates the exchange’s commitment to meeting the demand for derivatives among global retail traders. While facing regulatory scrutiny in its home country, Coinbase is strategically expanding its operations internationally to navigate these challenges. By obtaining regulatory approvals and expanding its offerings, Coinbase aims to provide a secure and transparent platform for crypto traders worldwide. Despite legal obstacles in the US, Coinbase’s focus on compliance and regulatory partnerships positions it as a key player in the evolving cryptocurrency market.
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