Coinbase Advanced provides retail traders in the United States with access to regulated cryptocurrency futures contracts four months following the approval of Coinbase Financial Markets (CFM) to function as a Futures Commission Merchant (FCM).
On August 17, CFM obtained regulatory approval from the National Futures Association (NFA), recognized by the Commodity Futures Trading Commission as a self-regulatory organization, to operate an FCM and deliver crypto futures services to qualified U.S. traders.
In details shared with Cointelegraph, CFM disclosed that Coinbase Advanced users in the U.S. can engage in trading nano-sized futures contracts equivalent to 1/100th of 1 Bitcoin (BTC) and 1/10th of 1 Ether (ETH). As stated by Andrew Sears, the CEO of CFM:
“These contracts present lower initial capital requirements and can serve as an accessible investment option for a wider array of retail clients.”
The nano-Ether contract enables participants to manage risk, trade with leverage, or speculate on Ether’s price. The nano-Bitcoin contract allows users to wager on the prospective price of BTC.
Alongside offering regulated, leveraged, and cash-settled crypto futures, users will gain access to an educational content library through Coinbase Learn. U.S. residents with an active Coinbase account for spot trading are qualified to establish an FCM futures account.
The services have been launched on the web platform and will soon be accessible on mobile devices.
Related: Coinbase quells rumors of weekly withdrawal limits on Bitcoin
Coinbase’s choice to introduce crypto futures services appeared logical as the exchange experienced a significant drop in spot trading volume this year compared to 2022.
An analysis by digital asset data provider CCData indicated that Coinbase recorded approximately $76 billion in spot trading volume — representing a 52% decrease in spot trading for Q3 2023 compared to the corresponding period in 2022.
Despite the downturn in spot trading volume, Coinbase captured additional market share in the last quarter as the crypto exchange Binance faced heightened scrutiny from regulators.
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