Coinbase Gains NFA Approval For Futures Trading
Coinbase, a leading cryptocurrency exchange, is set to revolutionize the trading landscape by enabling its customers to directly access futures through its newly launched platform, Coinbase Financial Markets. This move comes as part of the company’s commitment to promoting transparency, regulation, and broader participation in the rapidly growing cryptoeconomy.
This is a significant milestone for bringing federal regulatory oversight over the crypto markets that protects consumers and helps ensure the US remains a center for digital innovation.https://t.co/Kdd2BlhAEM
— Coinbase 🛡️ (@coinbase) August 16, 2023
NFA Approval for FCM Status
Since September 2021, Coinbase has been diligently working to secure regulatory approval from the National Futures Association (NFA) to establish itself as a registered Futures Commission Merchant (FCM). This strategic step aligns with Coinbase’s philosophy of adhering to robust regulatory standards and customer protection requirements set by the Commodity Futures Trading Commission (CFTC). Coinbase’s decision to go public in the United States underscores its confidence in the country’s regulatory framework, emphasizing consumer protection.
“We believe this is a watershed moment to be able to bring regulated crypto products to US customers,” remarked a Coinbase spokesperson. The approval secured by Coinbase paves the way for eligible US customers to seamlessly access regulated derivatives products through Coinbase Financial Markets, operating under the vigilant oversight of the CFTC and the NFA. This development is poised to expand the reach of the cryptoeconomy to a wider audience while maintaining the necessary safeguards.
FairX Acquisition
Coinbase’s acquisition of FairX in 2022, now rebranded as the Coinbase Derivatives Exchange, further solidified its position in the crypto derivatives market. The exchange has already introduced nano Bitcoin and Ethereum futures contracts tailored for retail investors, later expanding its offerings to cater to the institutional market. Notably, the exchange has garnered substantial traction, with over $4.7 billion BTC and $2.0 billion ETH futures traded in notional volume thus far in 2023.
Related: Europe Launches First Bitcoin ETF
The introduction of regulated crypto derivatives products represents a milestone in the evolution of the cryptocurrency industry. By granting users access to margin trading, these products offer increased leverage and accessibility to the crypto market. They also provide investors with the ability to manage risk associated with their crypto holdings.
