Coinbase Gains Regulatory Nod for Perpetual Futures Trading

Coinbase, the leading US-based cryptocurrency exchange, announced on Thursday that it has secured regulatory approval from the Bermuda Monetary Authority (BMA) to extend its perpetual futures trading services to non-US retail customers. The announcement came via a blog post, revealing that the service will be available to eligible customers on Coinbase Advanced in the coming weeks.

Expanding Futures Trading

Coinbase International Exchange, the international arm of the exchange, has already recorded over $5.5 billion in notional futures trading volume from institutional clients in Q2 of this year. With the latest approval, Coinbase is set to broaden its services to include retail customers, acknowledging the substantial role of derivatives trading in the global crypto market, which constitutes approximately 75% of total trading volume.

Advocating for Regulatory Clarity

Coinbase emphasized its commitment to collaborating with “forward-looking regulators” to develop a robust regulatory framework that balances crypto innovation with consumer protection. The exchange expressed its dedication to partnering with global regulators to establish a regulatory environment conducive to the sustained growth and widespread adoption of cryptocurrencies.

A Global Strategy

Coinbase’s international strategy is targeting 24 countries, including G20 members and financial hubs like Hong Kong, Switzerland, the United Arab Emirates, and Singapore. The exchange plans to leverage the upcoming G20 forum in Brazil to advocate for standardized international regulations for the cryptocurrency industry.

Strengthening Presence in Europe

Coinbase has been fortifying its global presence, recently acquiring an Anti-Money Laundering (AML) compliance registration from the Bank of Spain, enabling it to operate as a registered crypto exchange in Spain and offer its comprehensive suite of products and services while adhering to local legal frameworks. The exchange has also secured Virtual Asset Service Provider (VASP) registrations in various European nations, including Italy, Ireland, and the Netherlands, and has initiated services in Singapore, Brazil, and Canada after receiving in-principle approvals.

Navigating Regulatory Challenges

Coinbase’s global expansion is unfolding amidst escalating regulatory tensions in the US. The SEC previously sued the exchange, alleging the sale of unregistered securities and other purported infractions, including operating unregistered financial services. Subsequent to the lawsuit, Coinbase received Show Cause orders from 11 US states, necessitating the exchange to defend its operational legitimacy in these jurisdictions.

Conclusion

Coinbase’s regulatory approval from the BMA marks a significant step in its global expansion strategy, allowing it to tap into the growing demand for perpetual futures trading among retail investors. While the exchange continues to navigate regulatory hurdles, its commitment to fostering innovation and advocating for regulatory clarity underscores its vision for the long-term evolution of the cryptocurrency ecosystem.