Coinbase Launches Offshore Crypto Exchange Amid Ongoing US Regulatory Issues

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By Anushree Dave

On Tuesday, Coinbase (COIN), the largest crypto exchange in the United States, announced the launch of a new product for crypto investors outside the country. The newly created international exchange will allow institutional investors based in eligible jurisdictions to trade perpetual futures contracts, according to a statement from Coinbase.

A perpetual futures contract is a type of derivative financial contract with no settlement time or expiry date, and according to Coinbase, perpetual futures trades accounted for around 75% of global crypto trading volume last year.

The news comes after continued back and forth between Coinbase and the United States Securities and Exchange Commission, which has cracked down on crypto companies in the United States over the past year, particularly after the collapse of the FTX crypto exchange in November 2022.

In April, Coinbase sued the SEC in an effort to get a clearer response to a petition the company filed last July, asking the SEC to provide clear guidance on how to regulate digital assets. This came just a month after the SEC hit Coinbase with a Wells notice, which identified potential violations of securities laws that could prompt them to take legal action.

“Coinbase chose to become a public company in the United States because we believe the United States would be best served by embracing this fundamental innovation,” Coinbase said in a statement Tuesday. “But we’re also focused on international markets, many of which are moving forward with strategies to become ‘crypto hubs’.”

The Coinbase International Exchange will initially only be accessible via an API, which means it currently has no app or website for users.

-Anushree Dave

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05-02-23 1559ET

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