Coinbase, the leading cryptocurrency exchange, has announced that its subsidiary, Coinbase Financial Markets, Inc., has been granted regulatory approval by the National Futures Association (NFA) to operate as a Futures Commission Merchant (FCM).
This approval paves the way for Coinbase to offer eligible US customers access to cryptocurrency futures trading, a significant development in the ever-evolving landscape of digital finance.
According to the blog post, the endorsement from the NFA, a self-regulatory body designated by the Commodity Futures Trading Commission (CFTC), marks a momentous achievement for Coinbase. The exchange’s commitment to maintaining a regulated and compliant business model is underscored by this milestone, positioning it as a secure and trusted platform within the crypto economy.
The company’s latest strategic move sets the stage for pioneering advancements as it becomes the first crypto-native platform to offer both traditional spot crypto trading and regulated leveraged crypto futures. This groundbreaking integration promises verified customers a comprehensive trading experience, symbolizing a remarkable new era in the world of cryptocurrencies.
Emphasizing their dedication to transparency and adherence to regulatory standards, the company revealed that the approval process was initiated back in September 2021 when they applied to the NFA for FCM registration. Since then, their teams have worked diligently to ensure full compliance with regulatory requisites in alignment with the CFTC’s customer protection criteria.
The company’s spokesperson responded with great enthusiasm to the approval, considering it a pivotal moment for the company and the US crypto economy. The spokesperson stressed the significance of regulatory clarity and collaboration in fostering wider participation in the digital financial domain.
Coinbase Financial Markets is set to introduce regulated derivatives trading on its integrated platform. This move aims to enhance the appeal of crypto trading by offering customers more flexible investment options.
Coinbase’s Strategic Acquisition
In 2022, the company showcased its proactive approach to expanding its derivatives market presence through the acquisition of FairX. This strategic move resulted in the establishment of Coinbase Derivatives Exchange. Coinbase’s entrance into the regulated crypto futures trading market is poised to attract both individual and institutional investors looking to tap into the vibrant realm of cryptocurrencies.
Given that around 75% of global crypto trading volume takes place in the derivatives market, this move by Coinbase holds significant allure for those seeking exposure to this dynamic landscape.
This regulatory approval not only solidifies the company’s position as a pioneer in the crypto industry but also aligns with its overarching goal of transforming the financial system to enhance economic freedom and opportunity.
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