Coinbase Receives Regulatory Approval for Crypto Futures Trading in the U.S.

(CTN News) – Coinbase, a leading cryptocurrency exchange, has announced that it has received regulatory approval to introduce federally regulated crypto futures trading for eligible customers in the United States. This significant development has led to a surge in the company’s shares ahead of the market opening. In this article, we will delve into the details of Coinbase’s regulatory approval, its implications for the cryptocurrency industry, and the company’s plans for offering cryptocurrency futures contracts.

Regulatory Approval and Background:

In June, the U.S. Securities and Exchange Commission (SEC) took legal action against both Binance and Coinbase, alleging that they were operating as unregistered securities exchanges. This prompted Coinbase to take proactive steps toward regulatory compliance. Coinbase revealed that it had filed an application with the National Futures Association (NFA) in 2021, seeking approval to operate as a futures commission merchant.

Coinbase’s Milestone Achievement:

Coinbase’s efforts have borne fruit, as the company recently announced that it has obtained regulatory approval from the NFA to operate as a futures commission merchant. This green light from the NFA paves the way for Coinbase to introduce regulated derivatives products through its Coinbase Financial Markets platform. These offerings will be subject to oversight by both the Commodity Futures Trading Commission (CFTC) and the NFA, ensuring adherence to established regulations and guidelines.

Crypto Futures Contracts on the Horizon:

With regulatory approval secured, Coinbase is now poised to bring cryptocurrency futures contracts to its U.S. customer base. Initially, the company plans to offer futures contracts for two of the most prominent cryptocurrencies, Bitcoin and Ether. These futures contracts allow traders to agree upon a price for buying or selling an asset at a predetermined date in the future, offering a new dimension to cryptocurrency trading.

Coinbase’s Vision and Commitment:

Coinbase expressed its enthusiasm for this regulatory milestone, referring to it as a “watershed moment.” The company’s announcement underscores its dedication to maintaining a regulated and compliant business environment. Coinbase aims to solidify its position as a trusted and secure platform for crypto-native users, ensuring that it aligns with regulatory standards while serving its customer base effectively.

Upcoming Launch and Market Response:

While Coinbase’s website currently displays a message indicating that U.S. regulated futures trading is coming soon, the company has already outlined its plans to launch Bitcoin and Ether futures trading for institutional investors on its Coinbase Derivatives Exchange. The anticipation surrounding this upcoming launch has led to a more than 5% increase in Coinbase Global Inc.’s shares, highlighting the market’s positive response to the regulatory approval and the company’s expansion into crypto futures trading.

Coinbase is a well-known cryptocurrency exchange platform that allows users to buy, sell, and store various cryptocurrencies like Bitcoin, Ethereum, Litecoin, and more. It was founded in 2012 by Brian Armstrong and Fred Ehrsam and has since become one of the most popular and user-friendly platforms for people to enter the world of cryptocurrencies.

Coinbase offers both a website and a mobile app through which users can create accounts, link their bank accounts or credit/debit cards, and conduct transactions involving cryptocurrencies. It provides various features such as real-time price tracking, secure storage solutions, and educational resources to help users understand the cryptocurrency market.

One of Coinbase’s notable offerings is its easy-to-use interface, making it a suitable choice for beginners in the cryptocurrency space. However, it’s worth noting that Coinbase charges fees for its services, including transaction fees and exchange rate spreads.

Over the years, Coinbase has expanded its services beyond just a cryptocurrency exchange and has introduced additional features like Coinbase Pro (formerly known as GDAX), which is a more advanced trading platform with lower fees for experienced traders.

It’s important to keep in mind that the cryptocurrency space is rapidly evolving, and platforms like Coinbase can introduce new features, changes, and services over time. If you’re considering using Coinbase or any other cryptocurrency exchange, it’s a good idea to stay informed about their latest offerings and any developments in the industry.