Coinbase has unveiled its regulated crypto futures services for retail traders in the U.S. four months after Coinbase Financial Markets (CFM) received the green light to operate as a Futures Commission Merchant (FCM). The National Futures Association (NFA), an arm of the Commodity Futures Trading Commission, granted this approval on Aug. 17.
Coinbase Advanced users now have the unique opportunity to trade in nano-sized futures contracts. These contracts are set at 1/100th of a Bitcoin and 1/10th of an Ether.
Andrew Sears, the CEO of CFM, highlighted the benefits of this development. He noted that these contracts demand less upfront capital. Hence, they present an affordable investment alternative for a wider demographic.
Besides offering lower capital requirements, the nano-Ether contract allows traders to manage risks and speculate on Ether’s price. Similarly, the nano-Bitcoin contract lets users predict the future price of Bitcoin.
As a result, these contracts provide flexibility and open up new opportunities for retail investors.
Coinbase is not just stopping at offering future services. Additionally, they are providing educational resources via Coinbase Learn. This move ensures that users can make informed trading decisions. Moreover, any U.S. resident with an active Coinbase spot trading account can create an FCM futures account.
The web version of these services is already up and running. Furthermore, there are plans to make it available on mobile devices soon.
Despite a 52% drop in spot trading volume in Q3 2023 compared to the previous year, Coinbase remains optimistic. Launching crypto futures services is a strategic response to these challenging market conditions.
Moreover, the exchange has managed to increase its market share. This step is noteworthy, especially since its main competitor, Binance, has faced increased regulatory scrutiny. Hence, Coinbase’s latest move not only diversifies its offerings but also positions it firmly in the evolving crypto landscape.