Coinbase, the biggest crypto platform in the US, is making progress in the world of crypto trading with its latest offering: leveraged crypto futures trading for a wider range of retail customers. This move is a significant milestone for the company, which has faced regulatory battles.
After receiving approval from the National Futures Association (NFA) in August, Coinbase’s subsidiary, Coinbase Financial Markets (CFM), can now offer federally regulated crypto futures trading to eligible customers in the US. This approval shows Coinbase’s resilience in the face of regulatory challenges, including a lawsuit by the Securities and Exchange Commission (SEC) earlier this year for alleged securities law violations.
One advantage of futures trading is the ability to trade with leverage, allowing traders to access the crypto market with less initial investment. CFM is taking this further by introducing “nano-sized futures contracts,” which require less capital and are more affordable for a wider range of retail customers. This move aims to level the playing field and make futures trading accessible to more traders.
To access these futures contracts, traders need a Coinbase account for spot trading and then set up a CFM futures account. This process ensures that traders have a basic understanding of cryptocurrency trading before engaging in leveraged futures trading.
CFM’s futures contracts allow traders to go long or short, helping them manage risk on their underlying crypto assets. This flexibility is crucial in the volatile crypto market, where prices can change rapidly. With futures trading, traders can profit from both rising and falling prices, opening up new strategies.
It’s worth noting that CFM’s futures trading isn’t limited to traditional retail customers. Coinbase Advanced, a platform for experienced traders, offers advanced tools such as different order types, TradingView charts, and APIs for automated trading. These features cater to US traders interested in crypto futures.
Coinbase’s commitment to operating a regulated and compliant business is evident in its efforts to obtain approval from regulatory agencies like the NFA. This commitment ensures a trusted and secure platform for customers in an industry still dealing with regulatory uncertainty.
The expansion of crypto futures trading to a wider range of retail customers is a significant step for Coinbase and the crypto industry as a whole. By improving access to leveraged trading and offering reduced capital requirements through nano-sized futures contracts, Coinbase is allowing more individuals to participate in the crypto market.
As cryptocurrencies gain popularity, futures contracts could be a game-changer. They provide traders with a way to manage risk, take advantage of market fluctuations, and potentially increase profits.
With Coinbase leading the way in opening up crypto futures trading to more retail customers, it’s clear that the company is at the forefront of innovation in the crypto space. As the industry evolves and regulatory frameworks become clearer, it’s expected that more platforms will offer similar opportunities to traders worldwide. The future of crypto trading looks promising.