Coinbase International Exchange, one of the leading names in the cryptoverse, has just received the green light from the Bermuda Monetary Authority (BMA). This approval marks a significant milestone as it paves the way for eligible non-US retail customers to engage in perpetual futures trading.
Perpetual futures trading is a type of futures trading with no expiration or settlement date. Instead, the contract is intended to endure indefinitely, allowing traders to maintain their positions for as long as they choose.
Perpetual futures contracts are settled daily, which means that the gains or losses from each day’s trading are settled at the end of the day. This kind of trading is popular in cryptocurrency markets but is also used in other financial markets.
Perpetual futures are powered by Coinbase International Exchange which is regulated by the Bermuda Monetary Authority (BMA). @CoinbaseIntExch follows the regulatory framework established by the BMA and maintains high standards of risk management, compliance, and user protections.
— Coinbase 🛡️📞 (@coinbase) September 28, 2023
Expanding Global Access to Derivatives Markets
Coinbase’s move towards enabling perpetual futures trading for non-US retail traders aligns with its Phase II strategy, aptly named “Go Broad, Go Deep.” In this phase, Coinbase seeks to collaborate with high-standard global regulators to establish a crypto regulatory framework that encourages innovation.
While Coinbase’s roots are in the United States, it believes in enabling broader access to regulated derivatives to offer economic freedom and opportunity to users across the globe.
The timing is particularly interesting, as many other crypto exchanges are facing increased scrutiny in different regions. In contrast, Coinbase’s approach to regulatory compliance has earned it the green light to extend perpetual futures trading to retail customers who are not based in the United States.
One of Coinbase’s standout features, as noted in the official statement, is its emphasis on security and transparency. While the crypto world is evolving rapidly, trust remains a critical concern for traders. Coinbase has already demonstrated its dedication, boasting of achieving over $5.5 billion in notional trading volume from institutions in Q2.
Accessing Perpetual Futures Trading with Coinbase
Importantly, Coinbase doesn’t engage in market-making, which can sometimes raise questions about liquidity and fairness. Instead, it relies on established and independent liquidity providers who have undergone rigorous compliance reviews. The company stated,
“Coinbase International Exchange follows the robust regulatory framework established by the BMA, maintaining high standards of risk management, compliance, and user protections.”
Starting now, eligible non-US retail traders can assess their suitability for perpetual futures trading on Coinbase Advanced, while actual trading is slated to commence in the coming weeks.
Meanwhile, Coinbase’s international expansion journey is in full swing, with licenses secured in various European countries, including the Netherlands, Spain, Ireland, and Italy.