By
Bena Ilyas
May 7th, 2024
By securing the latest regulatory approval, Coinbase would be able to offer its eligible customers access to regulated perpetual futures contracts on the Coinbase Advanced platform.
Coinbase International Exchange, holding a class F license granted by the Bermuda Monetary Authority (BMA), has disclosed that it has secured further regulatory clearance. This authorization now permits Coinbase to provide perpetual futures trading services to retail customers outside of the United States.
This is a clear indication of Coinbase’s willingness to expand its footprint in the international market. Earlier this year in May 2023, the company unveiled Coinbase International for offering crypto derivative services to institutional clients.
Perpetual futures is a derivative market that operates continuously without expiration. “As announced in Phase II of our “Go Broad, Go Deep” strategy, we are dedicated to partnering with high-bar global regulators to build a crypto regulatory framework that allows crypto technology to continually drive innovation,” noted Coinbase in its announcement.
By securing the latest regulatory approval, Coinbase would be able to offer its eligible customers access to regulated perpetual futures contracts on the Coinbase Advanced platform. Coinbase Bermuda maintains the exchange’s perpetual futures accounts with BMA regulating them.
In its announcement, the cryptocurrency exchange stated that the derivatives market accounts for nearly 75% of cryptocurrency trading volume. This recent regulatory clearance aims at enabling retail traders to enter the crypto derivatives market, which has predominantly been the domain of institutional players.
Furthermore, Coinbase emphasized that it does not partake in market-making activities. Reputable independent liquidity providers who have undergone rigorous compliance assessments will furnish the liquidity on the platform.
Coinbase Provides Access to Derivatives Market
Coinbase asserts that its platform provides a secure and proficient entry point for retail traders into the derivatives market. Access to Coinbase International Exchange is limited to non-US customers in specific countries. Also, prospective users undergo an eligibility assessment before they can open a Coinbase Advanced trading account.
This recent approval for Coinbase International to offer perpetual futures to retail clients follows closely on the heels of the platform’s approval by the National Futures Association (NFA) to offer crypto futures investments to eligible institutional clients in the United States.
Despite grappling with regulatory challenges from the Securities and Exchange Commission over its services, Coinbase has continued to expand its presence beyond US borders. The SEC filed a lawsuit against Coinbase in early June, alleging violations of local securities laws related to the sale of unregistered securities.
Recently, crypto exchange Coinbase also secured an operational license in Spain.