Crypto Giant Coinbase to Enhance EU Presence with Key Derivatives Acquisition
Coinbase has revealed plans to offer crypto-linked derivatives in the European Union (EU) market.
The company has reportedly told CNBC that it has entered into an agreement to acquire an unnamed holding company, which holds a MiFID II license.
MiFID II, the EU’s updated regulation governing financial instruments, was revised in 2017 to address concerns that it focused too heavily on stocks and overlooked other asset classes like derivatives, fixed income, and currencies.
Coinbase’s move to offer derivatives is part of its long-standing ambition to cater to professional and institutional customers.
If the acquisition is successfully completed, it will mark Coinbase’s first foray into derivatives trading within the EU.
With the MiFID II license, Coinbase will be able to provide regulated derivatives, including futures and options, to customers in select EU countries.
Currently, Coinbase offers spot trading in bitcoin and other cryptocurrencies.
The acquisition is subject to regulatory approval, and Coinbase anticipates the deal to close later in 2024.
“This license would help expand access to our derivatives products by allowing Coinbase to offer them to eligible European customers in select countries across the EU,” the exchange said in a blog post.
“As the industry leader in trusted, compliant products and services, we aim for the highest standards for regulatory compliance, and before operationalizing any license or serving any users, this entity must achieve our Five-point Global Compliance Standard.”
Derivatives trading holds significant importance for Coinbase, as the company states that derivatives account for 75% of overall crypto trading volumes.
While Coinbase faces competition from larger
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