futures

Ethereum futures ETFs could start trading next week — Bloomberg analyst

September 28, 2023 Coin Telegraph

An impending US government shutdown may be accelerating the launch of Ethereum futures ETFs, analysts suggest.

Ethereum futures exchange-traded funds (ETFs) could start trading for the first time in the United States as early as next week, according to Bloomberg analysts.

On Sept. 28, Bloomberg Intelligence analyst James Seyffart said it was “looking like the SEC is gonna let a bunch of Ethereum futures ETFs go next week potentially.”

His comments were in response to fellow ETF analyst Eric Balchunas who said he was hearing that the SEC wanted to “accelerate the launch of Ether futures ETFs.”

“They want it off their plate before the shutdown,” he said, adding that he's heard the various filers to update their documents by Friday afternoon so they can start trading as early as Tuesday next week.

Looking like the SEC is gonna let a bunch #Ethereum futures ETFs go next week potentially https://t.co/YoBD1d1ay8
— James Seyffart (@JSeyff) September 28, 2023

The U.S. government is expected to shut down at 12:01 am ET on Oct. 1 if Congress fails to agree on or provide funding for the new fiscal year, which is expected to impact the country's financial regulators among other federal agencies.

Neither specified their sources for this latest update on the long list of crypto ETFs in the queue.

There are 15 Ethereum futures ETFs from nine issuers currently awaiting approval, according to the analysts in a Sept. 27 note.

The analysts gave Ethereum futures ETFs a 90% chance of launching in October with Valkyrie’s Bitcoin futures product (BTF) poised to become the first to hold Ethereum exposure on Oct. 3.

“We expect pure Ethereum futures ETFs to start trading the following week thanks to Volatility Shares’ actions.”

However, “we don’t expect all of them to launch,” said the analysts.

Bitcoin price eyes $28K as Binance legal battle spurs bullish momentum

September 20, 2023 Coin Telegraph

Binance

Discover how margin and option metrics hint at Bitcoin's path to $28,000 amid the Binance legal battle.

The ongoing legal battle between the Binance cryptocurrency exchange and the U.S. Securities and Exchange Commission (SEC) took a surprising turn on Sep. 18.

Magistrate Judge Zia M. Faruqui rejected the SEC's request for access to Binance.US's systems. Instead, the Federal Magistrate suggested that the SEC should formulate specific discovery requests.

While this decision only temporarily postponed the need for Binance to demonstrate the separation between Binance.US's custody solution and Binance International, the market responded positively.

Bitcoin (BTC) surged to its highest level in three weeks, breaking above the $27,000 resistance. Traders are now wondering whether the rally has been supported by leverage or genuine spot buying demand.

This is where metrics related to Bitcoin derivatives could potentially provide the solution.

Investors must wait three weeks for further rulings

Judge Faruqui scheduled a follow-up hearing for Oct. 12 and called upon the involved parties to submit a status report before the event, as reported by Yahoo Finance. What might have seemed like a setback for the SEC, at least for the time being, could potentially increase the risks for Binance.

Binance's founder and CEO, Changpeng “CZ” Zhao, remains steadfast in asserting that Binance.US has never utilized Binance International's custody solutions, despite a document from Binance.US on Sep. 15 suggesting otherwise. Nevertheless, the SEC has yet to produce clear evidence of Binance attempting to mislead the court.

Regardless of the current evidence, or more accurately, the absence of reliable information provided by Binance, the outlook for Bitcoin bulls has significantly improved for the next three weeks, with no anticipated changes until the upcoming court hearing.

To gauge the increasing optimism among professional traders, let's examine Bitcoin's margin and derivatives metrics.

Bitcoin margin, options show clear path toward $28,000

Margin markets offer valuable insights into the positioning of professional traders as they enable investors to increase their exposure through stablecoin borrowing.

Conversely, Bitcoin borrowers can speculate on a cryptocurrency's price decline. A declining indicator suggests that traders are becoming less bullish, while a ratio exceeding 30 typically indicates excessive confidence.

*OKX stablecoin/BTC margin-lending ratio. Source: OKX*

Recent data reveals that the margin-lending ratio for OKX traders has dropped to its lowest point in three months, standing at 19x, down from 27x just a week ago. These findings suggest that the overwhelming dominance of leverage long positions has diminished, although the current ratio still favors the bulls.

Market sentiment can also be assessed by analyzing whether more activity is occurring through call (buy) options or put (sell) options.

A put-to-call ratio of 0.70 indicates that put option open interest lags behind the more bullish calls, implying a bullish momentum. Conversely, a 1.40 indicator favors put options, signifying bearish sentiment.

*BTC options volume put-to-call ratio. Source: Laevitas.ch*

The put-to-call ratio for Bitcoin options volume has recently shifted from favoring put options at 1.50 to a balanced 1.04 level on Sep. 20, indicating a reduced interest in protective puts.

Notably, since Sep. 18, BTC options volume has either been neutral or slightly favored put options, suggesting that professional traders were caught off-guard by the price rally above $27,000.

Both Bitcoin margin and options markets indicate a balanced demand between long and short positions. From a bullish perspective, this suggests that excessive leverage hasn't been utilized as Bitcoin's price climbed from $26,500 to $27,500 on Sep. 19.

However, bears may find solace in the fact that even as Bitcoin's price reached its highest level in three weeks, there was limited enthusiasm from buyers in the margin and options markets.

Nonetheless, the data does hint at buying support from spot orders, possibly indicating that big entities, or so-called whales, are accumulating regardless of price.

Now, BTC and other crypto bulls have a window of three more weeks, until Oct. 12, when the Federal Judge will convene another hearing and potentially issue orders that could pose challenges for Binance.US. In the meantime, a Bitcoin price rally above $28,000 is certainly on the table.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Nasdaq’s Hashdex mixed Ether ETF filing joins crypto ETF race

September 13, 2023 Coin Telegraph

Coin Telegraph

Known as the Hashdex Nasdaq Ethereum ETF, this investment fund is the first filing for futures and spot Ether holdings under the ‘33 Act and is overseen and supervised by Toroso Investments.

The Nasdaq stock exchange has submitted an application to the Securities and Exchange Commission (SEC) seeking approval to list an Ethereum Exchange-Traded Fund (ETF) offered by Hashdex, an asset management company. This ETF is designed to include a combination of spot ether holdings and futures contracts in its portfolio and pioneering a new approach to cryptocurrency investment within the regulatory framework.

Known as the Hashdex Nasdaq Ethereum ETF, this investment fund is the first '33 Act Ethereum futures filing of futures Ethereum under the ‘33 Act and is overseen and supervised by Toroso Investments. Toroso Investments is registered as a commodity pool operator with the Commodity Futures Trading Commission (CFTC) and is also a member of the National Futures Association.

The current surge in cryptocurrency ETF applications has placed significant emphasis on whether the proposed funds intend to include futures contracts or spot assets. While the SEC has granted approval for the former, the latter remains unapproved. Fund managers appear to be exploring a middle-ground option, testing their chances in this regulatory landscape.

The primary investment goal of the Hashdex fund is to ensure that its shares mirror the daily fluctuations in the Nasdaq Ether Reference Price. To achieve this objective, the fund intends to allocate its assets to investments in ether, ether futures contracts traded on the CME, as well as cash and cash equivalents. Nasdaq said in the 19b-4 form:

"Instead of holding 100% spot Ether, which could make it more susceptible to price manipulation in the spot market, the Fund will hold a mix of Spot Ether, Ether Futures Contracts, and cash,"

The Fund aims to decrease its reliance on the spot market and address worries regarding potential manipulation in unregulated Ether spot exchanges by including Ether Futures Contracts and cash in its holdings, it elaborated.

Hashdex joined the competition for a spot Bitcoin (BTC) exchange-traded fund in the United States. However, Hashdex’s approach differs from recent filings as it won’t depend on the Coinbase surveillance sharing agreement, opting to acquire spot Bitcoin from physical exchanges within the CME market.

In the previous week, both Ark Invest and 21Shares submitted applications to the SEC for a spot ether ETF, a type of ETF also being pursued by VanEck. The SEC has thus far deferred its determinations on all the applications it has received for spot cryptocurrency funds.

Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.

Magazine: Crypto regulation: Does SEC Chair Gary Gensler have the final say?

Bitcoin futures data hints at $22K as the next logical step

September 4, 2023 Coin Telegraph

Bitcoin futures data hints at K as the next logical step

basis

BTC derivatives flipped bearish after Bitcoin failed to establish bullish momentum despite the heightened spot ETF prospects.

A Bitcoin (BTC) price correction down to $22,000 is becoming increasingly likely as BTC derivatives have begun to exhibit bearish tendencies.

The price chart of Bitcoin leaves little doubt that investor sentiment worsened after the much-hyped victory by Grayscale Asset Manager against the U.S. Securities and Exchange Commission (SEC) on Aug. 29 and the postponement of multiple spot BTC exchange-traded fund (ETF) requests by the SEC.

The central question remains whether the prospects of an ETF can outweigh the growing risks.

Spot Bitcoin ETF hype is fading

By Aug. 18, the entire 19% rally that occurred following BlackRock ETF initial filing had fully retracted as Bitcoin moved back to $26,000.

Next, there was a failed attempt to reclaim the $28,000 support as investors raised the odds of an ETF approval following the positive news on Grayscale Bitcoin Trust (GBTC) request.

*Bitcoin/USD price index, 1-day. Source: TradingView*

Cryptocurrency investors' morale deteriorated as the S&P 500 index closed at 4,515 on Sept. 1, merely 6.3% below its all-time high from January 2022. Even gold, which hasn't been able to break above the $2,000 level since mid-May, is 6.5% away from its all-time high. Consequently, the general feeling for Bitcoin's investors just 7 months ahead of its halving in 2024 is certainly less positive than expected.

Some analysts will pin Bitcoin's lackluster performance on the ongoing regulatory actions against the two leading exchanges, Binance and Coinbase. Moreover, multiple sources claim that the U.S. Department of Justice (DOJ) is likely to indict Binance in a criminal probe. The claims are based on allegations of money laundering and potential violations of sanctions involving Russian entities.

Moreover, multiple sources claim that the U.S. Department of Justice (DOJ) is likely to indict Binance in a criminal probe. The claims are based on allegations of money laundering and potential violations of sanctions involving Russian entities.

North Code Capital CIO and Bitcoin supporter Pentoshi expressed the current conditions in a social network post:

I think we still will eventually get some bearish Binance news vs DoJ. That should be seen as opportunity!

But overall. We also likely get ETF’s this year or early next year and $btc heading to 401k’s

Said it before but this is a year for accumulation. Don’t lose sight of the…
— Pentoshi euroPeng (@Pentosh1) September 1, 2023

According to Pentoshi, the potential gains from a spot ETF approval outweigh the price impact from the eventual regulatory actions against the exchanges. There's no way to ascertain whether such an assumption is valid, but such an analysis fails to consider that U.S. inflation, as measured by CPI, has come down to 3.2% in July 2023 from 9.1% in June 2022.

Moreover, the U.S. Federal Reserve's (Fed) total assets have been reduced to $8.12 trillion, down from the recent $8.73 peak in March 2023. This signals that the monetary authority has been draining liquidity from the markets, which is detrimental to Bitcoin's inflation protection thesis.

Looking at a longer time frame, Bitcoin's price has been holding the $25,000 level since mid-March, but taking a closer look at derivatives data shows that bulls' conviction is getting tested.

Bitcoin derivatives show decreasing demand from bulls

Bitcoin monthly futures typically trade at a slight premium to spot markets, indicating that sellers are asking for more money to delay settlement. As a result, BTC futures contracts in healthy markets should trade at a 5 to 10% annualized premium — a situation known as contango, which is not unique to crypto markets.

*Bitcoin one-month futures annualized premium. Source: Laevitas.ch*

Bitcoin's current 3.5% futures premium (basis rate) is at its lowest point since mid-June, prior to BlackRock's filing for a spot ETF. This indicator reflects a decreased demand for leverage buyers utilizing derivative contracts.

Traders should also analyze options markets to understand whether the recent correction has caused investors to become less optimistic. The 25% delta skew is a telling sign when arbitrage desks and market makers overcharge for upside or downside protection.

In short, if traders anticipate a Bitcoin price drop, the skew metric will rise above 7%, and phases of excitement tend to have a negative 7% skew.

*Bitcoin 30-day options 25% delta skew. Source: Laevitas.ch*

As displayed above, the options' 25% delta skew has recently entered bearish territory, with protective put (sell) options trading at a 9% premium on Sep. 4 compared to similar call (buy) options.

BTC futures hint at $22,000 next

Bitcoin derivatives data suggests that the bearish momentum is gaining strength, especially since the approval of a spot ETF could potentially be deferred until 2024, given the SEC's concerns about the lack of measures to prevent a significant portion of trading occurring on unregulated offshore exchanges based on stablecoins.

Meanwhile, the uncertainty in the regulatory landscape does favor the bears as there's no way to dismiss the fear, uncertainty, and doubt (FUD) surrounding potential actions from the DOJ or the ongoing lawsuits against the exchanges by the SEC.

Ultimately, a retracement down to $22,000 — the level last seen when Bitcoin’s futures premium was 3.5% — is the most likely scenario, considering the recent inability to sustain a positive price momentum despite the heightened chances of a spot Bitcoin ETF approval.

CME Bitcoin trading volume surpasses Bybit, but is it impacting BTC price?

August 31, 2023 Coin Telegraph

CME

BTC trading volume at CME recently eclipsed Bybit, but what does this mean for Bitcoin's price?

The Chicago Mercantile Exchange (CME) introduced its Bitcoin futures contract in December 2017. This was around the same time that Bitcoin (BTC) had reached an all-time high of $19,800, but by late 2018, the price had dropped to $3,100. Investors in cryptocurrencies quickly learned that CME derivative contracts allowed them to make bullish bets with leverage but also enabled them to bet against the price, a practice known as shorting.

Historically, the Securities and Exchange Commission has rejected Bitcoin exchange-traded fund (ETF) proposals due to concerns about manipulation on unregulated exchanges. The growing significance of CME’s Bitcoin futures market might address this issue, and recently, Hashdex has even requested a Bitcoin ETF that relies on Bitcoin's physical trades within the CME market.

Professional traders often use BTC derivatives to hedge risks. For instance, one can sell futures contracts while simultaneously buying BTC using borrowed stablecoins using margin. Other examples include selling longer-term BTC futures contracts while purchasing perpetual contracts, which could help a trader benefit from price discrepancies over time.

CME overtook Bybit to become the second-largest BTC futures market

CME has played a key role in the Bitcoin futures market since 2020, amassing an impressive $5.45 billion in open interest by October 2021. However, over the following years, the gap widened, as CME's Bitcoin futures market reached $1.2 billion in January 2023, trailing behind exchanges like Binance, OKX, Bybit and Bitget.

More recently, the Bitcoin price dropped by 12.8% between Aug. 16 and Aug. 17, leading to a $2.4 billion reduction in the aggregate futures open interest. Notably, CME was the only exchange unaffected in terms of open interest. As a result, CME became the second-largest trading platform on Aug. 17, with $2.24 billion in BTC open interest, according to data from CoinGlass.

*Bitcoin futures open interest ranking. Source: CoinGlass*

It’s worth noting that CME exclusively offers monthly contracts, which differ from perpetual or inverse swap contracts, the most traded products on crypto exchanges. Additionally, CME contracts are always cash-settled, while crypto exchanges provide contracts based on both stablecoins and BTC. These distinctions contribute to the difference in open interest between CME and crypto exchanges, but there's more to the story.

CME futures show discrepancies relative to crypto exchanges

Aside from differences in contract settlement and the absence of perpetual contracts, the trading of Bitcoin futures on the CME diverges significantly from most crypto exchanges in terms of both volume and pricing dynamics. The CME records an average daily volume of $1.85 billion, which falls short of its $2.24 billion open interest.

In contrast, Binance’s BTC futures see a daily volume nearing $10 billion, three times greater than its open interest. A comparable pattern is observed at the OKX exchange, where daily trading in BTC futures reaches about $4 billion, surpassing its $1.4 billion open interest. This variance can be attributed partially to CME’s higher margin requirement and the fee-free trading environment for market makers on crypto exchanges. Additionally, CME’s trading hours are constrained, with a halt from 4:00 pm Central Time to 5:00 pm and a full closure on Saturdays.

However, various factors contribute to price distinctions compared to other exchanges. These include shifts in demand for leverage among long and short positions, along with potential disparities in the Bitcoin index price calculation across different providers. Lastly, it’s crucial to consider the solvency risks associated with the tie-up of margin deposits (collateral) until the BTC futures contract settlement.

*December 2023 BTC futures, CME (blue) vs. Binance (orange) vs. Bybit (cyan). Source: TradingView*

Notably, CME Bitcoin futures have traded at approximately $280 higher than those on Binance for the same December 2023 expiration. Ultimately, the day-to-day pricing of BTC futures contracts hinges on several variables. While CME’s trading volumes are trending upward, its pricing mechanism might not flawlessly mirror Bitcoin’s price movements on crypto exchanges.

Given the intricate interplay of variables impacting its pricing and trading dynamics, it fails to provide enhanced price guidance to BTC investors.

Crypto futures and ETFs are knocking at the door: Law Decoded, Aug. 13–20.

August 21, 2023 Coin Telegraph

Coin Telegraph

SEC is likely to approve multiple applications for Ether futures exchange-traded funds simultaneously.

Cryptocurrency exchange Coinbase has received approval from the United States National Futures Association to offer investments in crypto futures to eligible customers. The approval enables Coinbase to introduce Bitcoin (BTC) and Ether (ETH) futures contracts through its Commodity Futures Trading Commission-regulated derivatives exchange.

Meanwhile, citing sources familiar with the matter, The Wall Street Journal reported that the U.S. Securities and Exchange Commission (SEC) is likely to approve multiple applications for Ether futures exchange-traded funds (ETFs) simultaneously. So far, the SEC has not instructed the firms to withdraw their applications, unlike in 2021. This suggests the regulator won’t block the fund’s launch within a few weeks. The SEC’s decision on Bitcoin ETFs could also come in early 2024.

This could be why asset management firm Valkyrie has joined the list of companies filing for crypto ETFs. As per its application, the fund will not directly invest in Ether but will seek to purchase several ETH futures contracts. The ETF investment in Ether futures contracts will be limited to 8,000 contracts per month in compliance with position limits established by the Chicago Mercantile Exchange.

SEC is allowed to appeal in the Ripple case

U.S. Judge Analisa Torres has granted a request from the SEC to file a motion for leave to file an interlocutory appeal in its case against Ripple Labs. According to U.S. law, an interlocutory appeal occurs when a ruling by a trial court is appealed while other aspects of the case are still proceeding.

The decision came just a few hours after Ripple Labs voiced opposition to a potential appeal in the case. Ripple’s lawyers argued that an appeal requires a pure question of law and that the SEC’s request raises no new legal issues needing review. They also insisted that the regulator’s claim of an incorrect court ruling is insufficient and that an immediate appeal will not advance the termination litigation proceedings.

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Singapore gets its regulatory framework for stablecoins

Singapore’s central bank has released a revised regulatory framework to ensure stability for single-currency stablecoins regulated in the city-state. The framework outlines several requirements for stablecoin issuers, including redemption timelines, disclosures, reserve management and capital requirement. The Monetary Authority of Singapore noted only stablecoin issuers that fulfill the new framework’s requirements could apply to become MAS-regulated — a label the central banks says ensures they can be distinguished from non-regulated stablecoins by users.

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U.S. House Democratic coalition creates AI working group

Democrats from the U.S. House of Representatives have formed a working group on artificial intelligence to introduce new legislation around the nascent artificial intelligence (AI) tech sector. The 97-member New Democrat Coalition promises its unit to work with President Joe Biden’s administration, stakeholders and lawmakers from both sides of the political arena to develop “sensible, bipartisan policies to address this emerging technology.” According to Representative Derek Kilmer, who will serve as chair of the working group, its primary focus will be to crack down on the spread of misinformation and air concerns about advanced AI-generated deepfakes becoming increasingly prevalent online.

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Bitcoin price drops to a two month low — Did pro traders benefit?

August 18, 2023 Coin Telegraph

Coin Telegraph

A massive amount of traders were liquidated as BTC price dropped to $25,300, but was it primarily retail traders that were washed out?

The price of Bitcoin (BTC) fell by 11.5% from Aug. 16 to Aug. 18, resulting in $900 million worth of long positions being liquidated and causing the price to hit a two-month low. Before the drop, many traders expected a breakout in volatility that would push the price upward but this was obviously not the case. With the substantial liquidations, it's important to address whether professional traders gained from the price crash.

Bitcoin just saw one of its largest daily liquidations by volume in history.

Starting at 4:30 PM yesterday, #Bitcoin fell 7.5% in 20 MINUTES, erasing $42 billion in market cap.

This mass-liquidation event involved more outflows in 1 day than during the FTX collapse in November… pic.twitter.com/KmVNkXoOLw
— The Kobeissi Letter (@KobeissiLetter) August 18, 2023

There's a common belief among cryptocurrency traders that whales and market makers have an edge in predicting significant price shifts and that this allows them to gain the upper hand over retail traders. This notion holds some truth, as advanced quantitative trading software and strategically positioned servers come into play. However, this doesn't make professional traders immune to substantial financial losses when the market gets shaky.

For larger-sized and professional traders, a majority of their positions may be fully hedged. Comparing these positions with previous trading days allows for estimations on whether recent movements anticipated a widespread correction in the cryptocurrency market.

Margin longs at Bitfinex and OKX were relatively high

Margin trading lets investors magnify their positions by borrowing stablecoins and using the funds to acquire more cryptocurrency. Conversely, traders who borrow Bitcoin employ the coins as collateral for short positions, indicating a bet on price decline.

Bitfinex margin traders are known for swiftly establishing position contracts of 10,000 BTC or greater, underscoring the involvement of whales and substantial arbitrage desks.

As depicted in the chart below, the Bitfinex margin long position on August 15 stood at 94,240 BTC, nearing its highest point in four months. This suggests that professional traders were entirely caught off guard by the abrupt BTC price crash.

*Bitfinex margin BTC longs, measured in BTC. Source: TradingView*

Unlike futures contracts, the equilibrium between margin longs and shorts isn't inherently balanced. A high margin lending ratio signifies a bullish market, while a low ratio suggests a bearish sentiment.

*OKX USDT/BTC margin lending ratio. Source: OKX*

The chart above shows the OKX BTC margin lending ratio, which approached 35 times in favor of long positions on August 16. More importantly, this level aligned with the preceding seven-day average. This implies that even if external factors skewed the metric previously, it can be deduced that whales and market makers maintained their position on margin markets before the Bitcoin price collapse on Aug. 16 and Aug. 17. This information supports the argument that professional traders were unprepared for any form of negative price movement.

Futures long-to-short data proves traders were unprepared

The net long-to-short ratio of the top traders excludes external factors that may have exclusively influenced the margin markets. By consolidating positions across perpetual and quarterly futures contracts, a clearer insight can be gained into whether professional traders are leaning towards a bullish or bearish stance.

Occasional methodological disparities among different exchanges exist, prompting viewers to track changes rather than fixate on absolute values.

*Exchanges’ top traders Bitcoin long-to-short ratio. Source: Coinglass*

Prior to the release of the Federal Reserve FOMC minutes on August 16, prominent BTC traders on Binance exhibited a long-to-short ratio of 1.37, aligning with the peak levels observed in the previous four days. A similar pattern emerged on OKX, where the long-to-short indicator for Bitcoin's leading traders reached 1.45 moments before the BTC price correction commenced.

Irrespective of whether those whales and market makers augmented or diminished their positions post the initiation of the crash, data stemming from BTC futures further substantiates the lack of readiness in terms of reducing exposure prior to August 16, be it in futures or margin markets. Consequently, a reasonable assumption can be made that professional traders were taken by surprise and did not profit from the price crash.

U.S. SEC To Approve Ethereum Futures ETF Nearly Two Years After Authorizing Similar Bitcoin Product: Report

August 18, 2023 The Daily Hodl

Coinbase Wins Approval to Sell Bitcoin (BTC) and Ethereum (ETH) Futures Products in the US

August 16, 2023 The Daily Hodl

Coinbase wins NFA approval to offer Bitcoin and Ether futures in US

August 16, 2023 Coin Telegraph

Coin Telegraph

Coinbase is preparing to roll out cryptocurrency futures trading for institutional investors in the United States.

Cryptocurrency exchange Coinbase has obtained approval from the National Futures Association (NFA) to offer investments in crypto futures to eligible customers in the United States.

Announcing the news on Aug. 16, Coinbase stated that the company is now officially allowed to operate a Futures Commission Merchant (FCM) platform.

The approval enables Coinbase to introduce Bitcoin (BTC) and Ether (ETH) futures contracts through its Commodity Futures Trading Commission (CFTC)-regulated derivatives exchange.

“This is a critical milestone that reaffirms our commitment to operate a regulated and compliant business and be the most trusted and secure crypto-native platform for our customers,” Coinbase said in the statement.

According to a notice on Coinbase’s cryptocurrency futures web page, the new futures trading service will not be immediately available in the United States.

“U.S. regulated futures trading is coming soon. Sign up to join the waitlist and get early access,” the company said on the website.

In the announcement, Coinbase claimed that the global crypto derivatives market accounts for 75% of crypto trading volume worldwide. “The ability to trade using margin gives customers leverage and access to the crypto market with less upfront investment than traditional spot trading,” the firm added.

As previously reported, Coinbase officially announced plans to launch BTC and ETH futures trading for institutional investors in early June. Previously, Coinbase also planned to launch a derivatives exchange in Bermuda, marking a step in its global expansion strategy.

The news comes amid Coinbase’s ongoing legal battle against the U.S. Securities and Exchange Commission. The regulator filed a lawsuit against Coinbase in early June, alleging that the exchange violated local securities laws by selling unregistered securities.

Magazine: Big Questions: Did the NSA create Bitcoin?

Investors must wait three weeks for further rulings

Bitcoin margin, options show clear path toward $28,000

Spot Bitcoin ETF hype is fading

Bitcoin derivatives show decreasing demand from bulls

BTC futures hint at $22,000 next

CME overtook Bybit to become the second-largest BTC futures market

CME futures show discrepancies relative to crypto exchanges

SEC is allowed to appeal in the Ripple case

Singapore gets its regulatory framework for stablecoins

U.S. House Democratic coalition creates AI working group

Margin longs at Bitfinex and OKX were relatively high

Futures long-to-short data proves traders were unprepared

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