U.S. crypto exchange Coinbase has secured approval from the National Futures Association (NFA), a CFTC-designated self-regulatory organization, to operate a Futures Commission Merchant (FCM) and offer eligible US customers access to crypto futures. Thus, Coinbase is allowed to offer futures contracts for Bitcoin (BTC) and Ether (ETH) through its CFTC-regulated derivatives exchange.
The global crypto derivatives market is a critical trader access point and represents approximately 75% of crypto trading volume worldwide. The ability to trade using margin gives customers leverage and access to the crypto market with less upfront investment than traditional spot trading. Being able to express long and short positions, investors also use derivatives to manage risk on their underlying crypto assets.
Coinbase will now be the first crypto-native firm to directly offer traditional spot crypto trading alongside regulated and leveraged crypto futures on an integrated trading solution for our verified customers. In the statement, Coinbase emphasized, “This marks a pivotal achievement that underscores our commitment to conducting business in accordance with regulations, ensuring compliance, and establishing ourselves as the most reliable and secure platform for our customers who engage with cryptocurrency.”
As previously reported, Coinbase unveiled its intentions to introduce futures trading for Bitcoin (BTC) and Ether (ETH) targeted at institutional investors in early June. Furthermore, Coinbase had earlier outlined plans to launch a derivatives exchange in Bermuda, aligning with its overarching international expansion strategy. This announcement arrives amid Coinbase‘s ongoing legal dispute with the U.S. Securities and Exchange Commission (SEC). In early June 2023, the regulator initiated a lawsuit against Coinbase, alleging that the exchange had violated local securities laws by selling unregistered securities.
