Future

United

<p><strong>Coinbase got approved to become a futures commission merchant despite the ongoing SEC lawsuit.</strong></p> 
<h2 style="text-align: center;" id="approval-for-crypto-futures-trading">Approval for Crypto Futures Trading</h2> 
<p>Coinbase, a cryptocurrency exchange, <a href="https://www.coinbase.com/blog/coinbase-financial-markets-inc-secures-fcm-approval-to-bring-regulated" target="_blank" rel="noopener noreferrer nofollow">has been granted regulatory approval</a> to introduce regulated cryptocurrency futures trading to eligible customers in the United States. This development caused a notable increase in the company’s stock value before the market opened on Wednesday.</p> 
<blockquote class="twitter-tweet"> 
 <p dir="ltr" lang="en">The CFTC just approved <a href="https://twitter.com/coinbase?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">@coinbase</a> as a registered Futures Commission Merchant. US customers can now access ETH &amp; BTC Futures directly through Coinbase.</p> 
 <p>Pre-Market up 5.65% at the time of writing. Coinbase is so undervalued it’s insane. <a href="https://t.co/tFGGCpAWfm" rel="noopener noreferrer nofollow">pic.twitter.com/tFGGCpAWfm</a></p> 
 <p>— lior.eth (@lior_eth) <a href="https://twitter.com/lior_eth/status/1691766999930527971?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">August 16, 2023</a></p> 
</blockquote> 
<p><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script></p> 
<h2 style="text-align: center;" id="regulatory-hurdles-and-approval">Regulatory Hurdles and Approval</h2> 
<p>Earlier, in June, the U.S. Securities and Exchange Commission (SEC) <a href="https://walletinvestor.com/magazine/legal-scholars-support-coinbase-in-sec-legal-battle" target="_blank" rel="noopener noreferrer nofollow">took legal action</a> against both Binance and Coinbase. The SEC claimed that these companies were functioning as securities exchanges without complying with necessary registration. However, Coinbase has now disclosed that it has acquired regulatory endorsement from the National Futures Association (NFA) to operate as a futures commission merchant. This application had been submitted in 2021.</p> 
<blockquote class="twitter-tweet"> 
 <p dir="ltr" lang="en">Major moment for crypto regulatory clarity in the U.S.</p> 
 <p>This has been a multi-year process toward approval, and we’re excited to finally be launching federally regulated crypto derivatives with margin to our U.S. customers.</p> 
 <p>When there is a clear path to register, we do. <a href="https://t.co/TxSOAIpoPj" rel="noopener noreferrer nofollow">https://t.co/TxSOAIpoPj</a></p> 
 <p>— Brian Armstrong 🛡️ (@brian_armstrong) <a href="https://twitter.com/brian_armstrong/status/1691840658351546826?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">August 16, 2023</a></p> 
</blockquote> 
<h2 style="text-align: center;" id="benefits-of-approval">Benefits of Approval</h2> 
<p>With this approval in hand, eligible U.S. customers of Coinbase will have the opportunity to participate in regulated derivatives trading through Coinbase Financial Markets. The Commodity Futures Trading Commission (CFTC) and the NFA will oversee this trading activity. Coinbase will provide cryptocurrency futures contracts linked to bitcoin and ether, allowing users to agree to buy or sell assets at predetermined prices on future dates.</p> 
<h2 style="text-align: center;" id="coinbase-s-statement-and-future-plans">Coinbase’s Statement and Future Plans</h2> 
<p>Coinbase expressed this milestone as a pivotal moment, showcasing their dedication to conducting a compliant and regulated business. They intend to stand as a trusted and secure platform for customers in the crypto space. The company’s website currently informs visitors about the upcoming launch of regulated futures trading and encourages them to join a waitlist.</p> 
<p>In addition to individual investors, Coinbase aims to bring these regulated futures offerings to institutional investors as well. The company had previously disclosed its plan to introduce bitcoin and ether futures trading for institutional clients through the Coinbase Derivatives Exchange.</p> 
<blockquote class="twitter-tweet"> 
 <p dir="ltr" lang="en">Coinbase has achieved a milestone by securing approval from the NFA to operate as a Futures Commission Merchant in the U.S. <a href="https://twitter.com/coinbase?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">@coinbase</a> can now offer futures contracts in <a href="https://twitter.com/search?q=%24BTC&amp;src=ctag&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">$BTC</a> and <a href="https://twitter.com/search?q=%24ETH&amp;src=ctag&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">$ETH</a> to eligible customers.<a href="https://t.co/PWcvDo7Htj" rel="noopener noreferrer nofollow">https://t.co/PWcvDo7Htj</a> <a href="https://t.co/BzppMt8zb2" rel="noopener noreferrer nofollow">pic.twitter.com/BzppMt8zb2</a></p> 
 <p>— CoinDesk (@CoinDesk) <a href="https://twitter.com/CoinDesk/status/1691823667380937086?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">August 16, 2023</a></p> 
</blockquote> 
<h2 style="text-align: center;" id="market-reaction-and-ceo-s-perspective">Market Reaction and CEO’s Perspective</h2> 
<p>Following the approval, Coinbase Global’s shares experienced a 3% increase, reaching $81.55. The National Futures Association, a self-regulatory organization endorsed by the CFTC, granted this approval. Coinbase CEO Brian Armstrong had criticized the SEC for its regulatory stance, suggesting that it could discourage innovation in the crypto sector and prompt companies to move offshore. The NFA’s approval offers Coinbase an opportunity to tap into an unexplored market.</p> 
<h2 style="text-align: center;" id="global-derivatives-market-and-outlook">Global Derivatives Market and Outlook</h2> 
<p>The global crypto derivatives market constitutes a substantial portion, about 80%, of the entire cryptocurrency market. Derivatives like futures contribute to the market’s volatility. In July, the trading volumes for crypto derivatives reached approximately $1.85 trillion globally. Coinbase’s entry into this market signifies a significant expansion and diversification of its services.</p> 
<h2 style="text-align: center;" id="conclusion">Conclusion</h2> 
<p>Coinbase’s achievement of securing regulatory approval for cryptocurrency futures trading for its U.S. customers marks a milestone for the company. The recognition from the National Futures Association allows Coinbase to offer regulated derivatives products alongside its spot market, catering to both retail and institutional investors. This move not only enhances Coinbase’s business prospects but also contributes to the development and maturation of the broader cryptocurrency market.</p>

Coinbase Receives Approval for Crypto Futures Trading for U.S. Customers

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