Coinbase is expanding its European Target!
Coinbase is expanding its European Target! Coinbase, the cryptocurrency exchange giant, announced that it plans to offer crypto-linked derivatives in the EU by purchasing a MiFID II licensed company by preparing a big move in Europe. This move is seen as an important step in the company's goal of reaching professional and institutional investors worldwide.
EU Entrance Gate
The MiFID II licence paves the way for Coinbase to offer regulated derivatives such as futures and options in the EU. This step means that assets such as Bitcoin and other cryptocurrencies will go beyond spot trading services to offer a more comprehensive service. The deal is currently awaiting regulatory approval and is expected to be finalised in late 2024.
Priority Reconciliation:
Coinbase emphasises its commitment to adhering to strict EU compliance standards, including anti-money laundering, customer transparency and sanctions. The company says it has a 400-strong team with expertise from agencies such as the FBI and Department of Justice to ensure robust compliance across global operations.
Derivatives A Critical Battlefield:
Coinbase recognises the important role that derivatives play in cryptocurrency trading, noting that 75% of total volume comes from this segment. Despite fierce competition from giants such as Binance and Bybit, the company sees this move as vital to capture a larger share of the market.
The move continues Coinbase's recent international expansion efforts to offset challenges in the US market (e.g. SEC litigation). The designation of Ireland as its primary EU regulatory base and applications for additional licences in France and potentially under MiCA reflect the company's commitment to establishing a strong presence in Europe. Coinbase wants to advance its European ambitions!
Looking to the Future:
While the acquisition is still to be finalised and the EU presence operationalised, the move is seen as a bold step in Coinbase's global expansion strategy. The success of this initiative will depend on overcoming regulatory hurdles, competing effectively in the derivatives space and ensuring the highest level of harmonisation across various markets.
