Coinbase Advanced, a service offered by Coinbase Financial Markets (CFM), now allows retail traders in the United States access to regulated crypto futures contracts. This comes four months after CFM received approval from the National Futures Association (NFA) to operate as a Futures Commission Merchant (FCM) entity.
CFM has revealed that Coinbase Advanced customers in the U.S. can now trade nano-sized futures contracts, which are sized at 1/100th of 1 Bitcoin (BTC) and 1/10th of 1 Ether (ETH). These contracts offer lower upfront capital requirements and serve as an affordable investment option for a broader range of retail customers, according to Andrew Sears, the CEO of CFM.
With the nano-Ether contract, participants can manage risk, trade on margin, or speculate on the price of Ether. On the other hand, the nano-Bitcoin contract allows users to bet on the future price of BTC. These contracts provide opportunities for traders to navigate the crypto futures market with reduced risks and more flexibility.
Apart from enabling regulated, leveraged, and cash-settled crypto futures trading, users will also gain access to a library of educational content through Coinbase Learn. This educational resource will help users enhance their trading knowledge and stay informed about the latest developments in the crypto market. To be eligible for an FCM futures account, residents in the United States need to have an active Coinbase account for spot trading.
Initially, these services have been launched on the web version of Coinbase Advanced, but they will soon be made available on mobile devices as well. This move enhances accessibility and convenience for users who prefer to trade on-the-go.
Coinbase’s decision to launch crypto futures services aligns with the exchange’s aim to meet the evolving needs of its customers. The launch comes as Coinbase experienced a decrease in spot trading volume this year compared to the previous year. Data from digital asset data provider CCData revealed that Coinbase’s spot trading volume for Q3 2023 saw a significant 52% drop compared to the same period in 2022.
However, despite the decline in spot trading volume, Coinbase managed to gain market share in the last quarter. This can be attributed to increased regulatory scrutiny faced by crypto exchange Binance, one of Coinbase’s main competitors. As Binance dealt with regulatory challenges, Coinbase capitalized on the opportunity to attract traders who were looking for alternative platforms.
The introduction of Coinbase Advanced with crypto futures trading is a strategic move to expand the range of services offered by the exchange. It allows Coinbase to stay competitive and cater to the changing demands of the market. By offering regulated crypto futures contracts, Coinbase aims to provide users with more options to diversify their investment strategies and potentially increase their returns.
In conclusion, Coinbase Advanced now enables retail traders in the United States to access regulated crypto futures contracts. With lower upfront capital requirements and educational resources available through Coinbase Learn, a wider range of retail customers can now engage in crypto futures trading. This move by Coinbase reflects its commitment to adapt to market trends and offer innovative solutions to its users. As the exchange expands its services and maintains its market share, it continues to position itself as a leading player in the cryptocurrency industry.
