- After Coinbase received regulatory approval, the company’s service offering crypto futures to eligible US retail customers is now live.
- Coinbase noted at the time that the global crypto derivatives market represented approximately 75% of worldwide crypto trading volume and was a critical trader access point.
- Last year, the company acquired a CFTC-regulated futures exchange called FairX, creating the Coinbase Derivatives Exchange.
Coinbase, the largest cryptocurrency exchange in the United States, announced that it has started offering Bitcoin and Ethereum futures to customers in the United States.
Coinbase Launches Bitcoin and Ethereum Futures
Coinbase has stated that the service, which includes “nano” Bitcoin contracts, is now active after regulatory approval and is offered through Coinbase Financial Markets (CFM). The exchange aims to provide leveraged crypto futures trading to US customers.
According to the company statement, “US customers can now access regulated crypto futures. These futures are tailored especially for retail traders, with 1/100 Bitcoin and 1/10 Ethereum.”
In August, Coinbase announced it had received regulatory approval from the National Futures Association, a self-regulatory organization designated by the Commodity Futures Trading Commission (CFTC), to operate as a Futures Commission Merchant. At the time, Coinbase noted that it represented approximately 75% of the world’s crypto trading volume in the global crypto derivatives market and was a critical access point for traders.
Although the new service expands trading options, Coinbase emphasized the increased risk of value loss associated with futures trading. The company explained:
“Futures allow traders to hedge risks, diversify their portfolios, use leverage, and speculate on the market’s direction. Using leverage in futures trading can work for you or against you. The amount of loss using leverage may exceed the initial investment amount.”
Institutional Services
Last year, Coinbase created Coinbase Derivatives Exchange by acquiring a futures exchange regulated by the CFTC called FairX. The platform introduced new bitcoin and ether futures contracts tailored for institutional customers in June and remains open to third-party brokers, Futures Commission Merchants (FCMs), and market makers.
As Coinbase expands its operations and services to more customers, the crypto trading platform remains entangled in a long-standing regulatory battle with the US Securities and Exchange Commission (SEC). Earlier this year, the regulatory body accused Coinbase of failing to register as a securities exchange, broker, and clearing agency. The crypto exchange argues that the agency’s authority is limited to securities transactions only.
