Coinbase Launches Offshore Derivatives Exchange Amid Crypto Crackdown In U.S. 14

Coinbase Launches Offshore Derivatives Exchange Amid Crypto Crackdown In U.S.

  • Coinbase has launched an offshore crypto derivatives exchange based in Bermuda. 
  • Coinbase International Exchange will allow non-U.S. customers to trade perpetual futures. 
  • The Bermuda Monetary Authority recently granted a regulatory license to the American crypto giant. 

In a significant push for global expansion, American crypto giant Coinbase has announced the launch of Coinbase International Exchange, its offshore crypto derivatives trading platform. The new derivatives exchange is based in the Caribbean nation of Bermuda. The launch of the offshore exchange comes in light of intensifying scrutiny of crypto firms in the United States. 

Coinbase International Exchange Will Settle All Trades In USDC

According to a recent blog post by Coinbase, its new crypto derivatives exchange will allow users based in eligible jurisdictions outside the United States, to trade perpetual futures. The new Bermuda-based trading venture aims to tap into the perpetual futures trading space, which reportedly accounted for almost 75% of the global crypto trading volume in 2022. 

Coinbase International Exchange listed BTC and ETH perpetual futures contracts earlier today. These contracts will initially allow institutional clients to trade with up to 5x leverage. The new platform will not require any fiat on-ramps as all trading will be settled in USD Coin (USDC). It is important to note that the platform is not available for retail clients at this time. 

The announcement of the new exchange comes less than two weeks after Coinbase revealed that the Bermuda Monetary Authority (BMA) had granted it a regulatory license to operate in the British Overseas Territory. The crypto exchange lauded Bermuda’s favorable regulatory landscape and highlighted its high level of transparency, compliance, and cooperation. The exchange assured that it’s still committed to the American market, but highlighted the countries around the world that are setting up responsible regulatory frameworks for crypto.

We would like to see the US take a similar approach instead of regulation by enforcement which has led to a disappointing trend for crypto development in the US.” 

The launch of the overseas exchange comes amid the crackdown on crypto businesses in the United States. Regulators like the Securities and Exchange Commission (SEC) and the New York Department of Financial Services (NYDFS) have booked several crypto firms since the beginning of the year in what industry players have described as a campaign against the crypto industry. The SEC issued a Wells notice to Coinbase last month, stating the regulator’s intention to initiate enforcement actions against the exchange.