Coinbase introduced regulated futures trading in 26 countries in Europe on Monday. The futures trading service is available for Coinbase Advanced users. The service has been introduced in various countries, such as Germany, France, and the Netherlands.
Futures products will be offered by Coinbase’s MiFID-regulated entity. It has been confirmed that the initial list of futures contracts will include Bitcoin and Solana. Equity Index Futures is also included in the initial offerings.
Coinbase has announced that it will introduce the futures products in phases. This is as the feature will appear over time for eligible users in supported countries. The section is available inside the Coinbase Advanced platform on web and mobile.
The company said that European traders commonly use unregulated markets for crypto derivatives. Coinbase stated that the new service would offer a regulated alternative to these markets but within its existing platform. The move to launch this service is to onboard these traders to a regulated market structure.
Before users can use the service, they have to pass an eligibility test. The test includes a review of their trading experience and a know-your-customer verification. Users can fund their accounts with euros or the stablecoin USDC.
Coinbase has introduced two types of cash-settled futures contracts. The first category of contracts is the perpetual-style futures contracts. These contracts have a five-year expiry period and use an hourly funding system.
The perpetual-style contracts will settle once daily. However, the design will ensure continuous trading while meeting regulatory demands. The design is not similar to the perpetual contracts used by offshore exchanges.
The second category of contracts is the dated futures contracts. These contracts will expire on specific dates, either monthly or quarterly. They are marked daily using official settlement prices.
If traders hold these contracts until they expire, they are cash-settled. The above structure is based on market conventions in regulated derivatives markets. The pricing is based on official exchange data, according to the platform.
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The company has also introduced various instruments with leverage. The contracts have leverage up to 10 times, including products linked to Bitcoin, Ethereum, and certain equity indices.
However, other contracts have different leverage levels. The company stated that these vary between 4x and 5x, depending on the products. The limits depend on contract structure as well as risk profile.
Coinbase’s fees for its futures products begin at 0.02%. The company stated that this is aimed at ensuring wider access to derivatives trading. The company’s fee structure is part of its overall trading strategy.
Coinbase stated that it is listing Mag7 + Crypto Equity Index Futures as part of its available products. The index is a mix of technology stocks and crypto. This is part of its overall strategy of combining traditional and digital asset markets.
The exchange described the launch as part of an expansion plan. Coinbase stated that it plans to create what it calls an “exchange for everything.” This is in the form of providing more financial services within the Coinbase application.
The firm stated that Europe is building better rules around digital assets. The firm referred to an improving regulatory clarity across the region. The company stated that this could provide an opportunity for further development in the future.
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