Major crypto exchange Coinbase is introducing certain derivatives to retail clients on June 27.
On Monday, Coinbase Derivatives Exchange will launch Nano Bitcoin futures (BIT) – its first listed crypto derivatives product, the company said.
Coinbase Derivatives Exchange is a Designated Contract Markets (DCM) futures exchange regulated by the US Commodity Futures Trading Commission (CFTC). Bitcoin futures track the price movements of bitcoin (BTC), allowing investors to gain exposure to the coin but without having to actually hold the underlying asset.
BIT futures will initially be available for trading via several broker intermediaries, said the exchange’s head, Boris Ilyevsky, naming retail brokers EdgeClear, Ironbeam, NinjaTrader, Optimus Futures, Stage 5, and Tradovate, as well as clearing firms ABN AMRO, ADMIS, Advantage Futures, ED&F Man, Ironbeam, and Wedbush.
Ilyevsky added that,
“Coinbase is awaiting regulatory approval on its own futures commission merchant (FCM) license so we can offer margined futures contracts directly to our clients.”
The BIT Futures contract will offer benefits such as “around-the-clock trading, lower upfront investment, leverage and the ease of going long and short,” but “with the retail trader in mind.”
“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.”
According to a May report by crypto market data provider CryptoCompare, CME’s monthly futures volumes across BTC and ethereum (ETH) contracts saw “a surge” in volume in May, “indicating a rise in speculative activity.” BTC futures contracts in CME recorded the highest number traded since February 2021 with a volume of 250,650 – up 65% since April.