Coinbase receives approval to offer crypto futures

Coinbase said Wednesday that it had secured regulatory approval from the NFA to operate as a futures commission merchant

Coinbase said it has got regulatory approval to bring federally regulated crypto futures trading to eligible U.S. customers, sending the company’s shares sharply up before the opening bell Wednesday.

In June, the U.S. SEC filed lawsuits against Binance and Coinbase, saying that the firms were in violation of the law since they were operating as securities exchanges without registering with the agency.

Coinbase said Wednesday that it had secured regulatory approval from the NFA to operate as a futures commission merchant. The crypto currency exchange said that it filed its application with the association in 2021.

Now that it has got approval, Coinbase says eligible U.S. customers will be able to access regulated derivatives products via Coinbase Financial Markets, subject to the supervision of the CFTC and the NFA.

The firm said in a tweet that it can now offer crypto currency futures contracts in bitcoin and ether. Futures are derivative contracts to buy or sell an asset at a later date at a price earlier agreed to under a contract.

We believe this is a watershed moment to be able to bring regulated crypto products to U.S. customers, the crypto exchange added. This is a crucial landmark that reasserts our commitment to operate a regulated and compliant business and be the most trusted and reliable crypto-native platform for our customers.

The Coinbase website presently has a message that says U.S. regulated futures trading is coming soon.

The firm earlier announced that it planned to introduce bitcoin and ether futures trading for institutional investors on its Coinbase Derivatives Exchange in June.

Coinbase Global Inc. shares gained over 5 per cent before the market opened.