According to the latest report, Coinbase, one of the leading crypto exchanges, is looking into providing perpetual futures contracts as well as other types of derivatives in Canada. Consequently, this has opened up discussions between industry players and regulators on the country’s financial policies that need updating. This is happening after market rivals such as Gemini and Kraken have opted for the same approach, indicating their interest in introducing more cryptocurrencies into the Canadian market.
As previously reported by Tronweekly, the CEO of Coinbase said that there were big plans awaiting 2024. Coinbase ended up having a significant financial year with an EBITDA of $3.1bn and revenue. Coinbase introduced its innovative products which included: The Coinbase International Exchange, derivative products, and blockchain-scaling Layer 2 Base. However, in addition to the international expansion and derivatives, the company had various ambitious ones, including growth in trading fee revenue for 2024.
Coinbase’s Approach to Challenges & Opportunities
The company expanded its operations into Canada last March as part of its global expansion strategy, acknowledging the country’s potential for crypto market growth. In an exclusive Interview, Lucas Matheson, Coinbase Canada’s country director, regards this step as a growth of the spot market naturally resulting in efficient and trusted digital asset service offerings.
According to Matheson, while regulated better than some others, Canada is still conservative. Nevertheless, he claims that compared to other countries that are struggling with their legislation on cryptocurrencies, like the U.S., Canada is way ahead in terms of regulatory clarity. The significance of Coinbase’s pursuit of “restricted dealer registration” in Canada is heightened by its dependence on trading fees as a source of income. Therefore, long-term sustainability demands diversifying revenue streams beyond market fluctuations to have new product offerings in Canada.
Coinbase also seeks to bring perpetual futures contracts and other derivatives products to Canada, lobbying politicians and regulators such as the Ontario Securities Commission for regulatory changes. Coinbase’s association with the Canadian Web3 Council demonstrates its commitment to facing regulatory challenges. In addition, recent regulatory changes have led some exchanges to exit Canada, further emphasizing the need for regulatory clarity for crypto firms.
According to Matheson:
What’s interesting and fairly unique about Canada is that we don’t have a strong political vision for how digital assets are going to help our economy in Canada. And so one of the things that our whole industry has been working really hard on is how do we educate our government officials and demystify some of the myths and misunderstandings about the digital economy.