Coinbase Shakes Up US Market with Bitcoin & Ethereum Perpetual Futures Launch

Wall Street's old guard just got a crypto-sized wake-up call.

Coinbase—the OG of US crypto exchanges—just dropped perpetual futures for Bitcoin and Ethereum on its stateside platform. No more offshore hopping for leveraged traders.

Why this matters: The move effectively bypasses traditional finance's slow-roll approach to derivatives. While banks were busy 'evaluating risks,' Coinbase built the damn thing.

Liquidity play: This could pull billions in volume back from unregulated offshore books. Or at least give the CFTC another reason to lose sleep.

One cynical footnote: Nothing unites Wall Street and crypto like the smell of leveraged trading fees. Some traditions die hard.

Perpetual futures make up 90% of trading volumes

Coinbase’s unveiling of the Bitcoin (BTC) and ethereum (ETH) perks on the regulated platform adds to the growing resurgence of the crypto markets in the U.S. A lot of this has happened amid increased regulatory shift to a supportive environment, largely exemplified by the recent adoption of a major stablecoin bill.

Perpetual futures are a type of derivative contract that allows crypto traders to access higher-leverage trades but without the monthly expiration dates.

In crypto, perpetual futures trading accounts for almost 90% of trading volumes. While Coinbase’s international users have had access to the perps, the U.S. regulatory landscape meant the exchange could not offer it. The launch changes all that.

“The wait is over – Perpetual futures have arrived in the U.S.,” Coinbase noted on X.

Apart from offering no monthly expirations, users can trade with up to 10x leverage and fees as low as 0.02%. 

Unlike traditional futures, which offer monthly or quarterly expiration dates, the perpetual futures on Coinbase will be long-dated and see users benefit from expiration dates of five years. The 10x leverage enables enhanced capital efficiency, allowing traders to increase their market exposure and positions.

While this is significant news for BTC and ETH traders, users should be aware of the risks associated with Leveraged futures trading. As with any other market, a trade can work for or against a trader, with high leverage meaning increased risk of losses.