25 April, 2024

Coinbase Secures Regulatory Approval for US Crypto Derivatives Market Access

16 Aug, 2023

21 Nov, 2023

  • Coinbase secures approval for US customers to access regulated derivatives, reinforcing commitment to a compliant crypto economy.
  • The platform’s acquisition of FairX highlights its dedication to regulatory compliance, leading to a successful launch of regulated futures contracts.
  • The regulatory approval enhances the firm’s access to regulated derivatives for US customers.

In a pivotal move that underscores its commitment to fostering transparency and compliance within the cryptocurrency realm, Coinbase has secured a significant milestone. As per a recent Coinbase tweet, the platform’s journey towards offering regulated crypto derivatives products to US customers has reached a significant juncture, boosting confidence in the broader crypto economy.

This announcement comes as the culmination of a journey that began in September 2021 when Coinbase applied with the National Futures Association (NFA) to register as a Futures Commission Merchant (FCM). Subsequently, the Coinbase team has engaged in meticulous cooperation with regulatory bodies, diligently guaranteeing adherence to essential regulations and carefully harmonizing its operational approach with the customer-safeguarding criteria established by the Commodity Futures Trading Commission (CFTC).

According to a recent report, Coinbase’s proactive engagement with regulatory bodies is emblematic of its belief that clear and sensible regulations form the bedrock for instilling confidence in individual customers and institutions alike. The company’s resolute stand in becoming a publicly listed entity in the United States echoes its unwavering belief that the US, with its robust regulatory framework and steadfast commitment to consumer protection, is poised to lead the way in embracing the cryptoeconomy.

The import of this approval cannot be underestimated, as eligible US customers gain access to regulated derivatives via Coinbase Financial Markets, seamlessly enhancing its existing spot market. This development holds the endorsement of the CFTC and the NFA, guaranteeing a trading experience held to the highest oversight standards. Trading in regulated derivatives offers new investor avenues, offering leverage and market access with lower upfront investment than traditional spot trading.

Coinbase’s pursuit of regulatory compliance and transparency also manifested through its acquisition of FairX in 2022. This move brought the CFTC-regulated futures exchange under its umbrella, now known as the Coinbase Derivatives Exchange. This acquisition culminated in successfully launching nano Bitcoin and Ethereum futures contracts tailored to retail and institutional investors.

The Coinbase Derivatives Exchange’s resounding success underscores the substantial liquidity pool, with $4.7 billion BTC and $2.0 billion ETH futures traded in notional volume in the current year. With FCM approval secured, Coinbase has forged another link in its chain of secure and transparent markets, offering verified US customers a regulated future offering that seamlessly complements its established spot market.


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