U.S. retail customers will soon be able to trade crypto futures on Coinbase Global, the largest crypto exchange in the U.S., after it received regulatory approval from the National Futures Association.
The exchange announced the news on Wednesday, saying it was a “critical milestone that reaffirms our commitment to operate a regulated and compliant business.”
Coinbase shares rose 5% in premarket trading following the announcement.
Coinbase applied to register as a futures commission merchant (FCM) with the NFA, a self-regulatory organization supervised by the CFTC, in September 2021.
An FCM is a type of brokerage that allows investors to buy and sell futures contracts on Coinbase’s platform.
Futures are contracts that let traders speculate on the price movements of markets such as oil, wheat or the S&P 500. Traders who want to trade futures have to deposit cash collateral, called margin, at an FCM.
The approval comes amid a legal dispute between Coinbase and the U.S. Securities and Exchange Commission, which sued the exchange in June for operating illegally without registering as an exchange.
