After an eagerly awaited period of nearly two years, Coinbase (COIN), a prominent player in the cryptocurrency exchange arena, has successfully obtained approval to introduce crypto futures trading in the United States. This significant achievement positions Coinbase at the forefront as the inaugural crypto-centric platform to provide both regulated and leveraged crypto futures, running parallel to the conventional spot trading landscape.
Coinbase Financial Markets has secured the highly sought-after endorsement from the National Futures Association (NFA) to function as a Futures Commission Merchant (FCM), as revealed in a recent announcement on Wednesday. The role of FCMs revolves around facilitating the buying or selling of futures contracts, much like that of a market maker, thus enhancing Coinbase’s footprint and influence in the market.
The National Futures Association, a self-regulatory entity endowed with acknowledgment from the federal derivatives overseer, the Commodity Futures Trading Commission (CFTC), plays a pivotal role in upholding industry standards. It is notable that Coinbase embarked on the path toward NFA affiliation back in September 2021.
The NFA’s stamp of approval marks a substantial accomplishment for Coinbase, as it leads the way in the domain of crypto-focused platforms in the U.S. by seamlessly integrating regulated and leveraged crypto futures into the well-established framework of spot trading. This pivotal milestone underscores the platform’s unwavering dedication to promoting broader engagement within the flourishing crypto economy while adhering steadfastly to the mandates of security and regulatory compliance.
Andrew Sears, CEO of Coinbase Financial Markets, underscored the paramount significance of this achievement, articulating, “Creating a secure and regulated gateway for U.S. investors to access crypto futures is a pivotal step toward fostering growth and enhancing participation in the dynamic crypto landscape.”
Coinbase’s pioneering endeavor is in line with the strides taken by Cboe Digital, the crypto arm of Cboe Global Markets, which garnered regulatory approval from the CFTC in June to introduce margined bitcoin and ether futures contracts. This regulatory endorsement underscores the ongoing commitment to thoughtfully integrate cryptocurrencies within the regulatory framework of financial markets, with a distinct emphasis on vigilance, transparency, accountability, and risk management.
Subsequent to this announcement, COINBASE shares, publicly traded on the Nasdaq, surged impressively by over 4%, opening at $82.49. As of the time of reporting, the shares have maintained their robust trading position, hovering around $79.50, signifying a modest increase of 0.3%.
Disclaimer: This article is intended solely for informational purposes and should not be construed as financial or investment advice. The information provided is subject to change, and readers are strongly advised to conduct thorough research before making any investment decisions.
