On June 27, Coinbase Derivatives Exchange, formerly FairX, will introduce its first cryptocurrency derivatives product. It will be a tiny Bitcoin futures (BIT) contract, which was announced on Friday and is aimed at retail investors.
“Our BIT Futures contract will offer the same benefits [as regular futures contract] but is built with the retail trader in mind,” Coinbase stated.
“At 1/100th of the size of a Bitcoin , it requires less upfront capital than traditional futures products and creates a real opportunity for significant expansion of retail participation in US regulated crypto futures markets.”
The contracts will first be traded through a number of reputable broker intermediates, such as EdgeClear, Ironbeam, NinjaTrader, Optimus Futures, Stage 5 and Tradovate. Additionally, clearing companies like ABN AMRO, ADMIS, Advantage Futures, ED&F Man, Ironbeam, and Wedbush will offer it.
Meanwhile, Coinbase is looking for a futures commission merchant (FCM) license in the United States so that it can offer margined products to its customers directly.
Getting into the Crypto Futures Market
Coinbase is one of the most popular cryptocurrency exchanges in the United States. Its crypto derivatives intentions were revealed with the acquisition of FairX, which operates as a CFTC-regulated exchange.
At the start of this year, the -regulated Designated Contract Markets (DCM) futures exchange was launched.
Despite the fact that numerous crypto trading behemoths provide crypto derivatives, only a small number of them are active in the US market because of strict laws.
The most recent news was only made after the American cryptocurrency exchange chose to close Coinbase Pro, its professional crypto trading platform. The exchange is additionally dealing with anger from the community due to continual layoffs.
The price of the crypto exchange’s publicly traded shares has dropped considerably since it first appeared on the market, but it increased by more than 13% during the most recent trading session.