Coinbase Derivatives Announces New Leveraged and CFTC-Regulated Futures Contracts for Bitcoin Cash, Litecoin, and Dogecoin: A Giant Leap Towards Broader Adoption
The cryptocurrency community was abuzz with excitement on March 21, 2024, when Coinbase Derivatives, the derivatives department of the popular cryptocurrency exchange platform, made a significant announcement. They revealed their intentions to launch the first leveraged and Commodity Futures Trading Commission (CFTC)-regulated futures contracts for Bitcoin Cash, Litecoin, and Dogecoin. This development came as a massive boost of confidence for investors in these altcoins, which have held strong positions in the top ten cryptocurrency space for an extended period. Coinbase International shared the news via a tweet that generated considerable traction (see Figure 1).
Figure 1: Coinbase Institutional announces new futures contracts on Twitter.
This announcement serves as a further endorsement for Dogecoin, which has often been referred to as the “father of meme coins.” Dogecoin’s transition towards a more stable cryptocurrency with clear-use cases is evident, given its growing popularity and recent significant growth. Its reputation as a legitimate cryptocurrency was solidified when it was listed as an acceptable payment method for purchasing Tesla vehicles (see Figure 2).
Figure 2: Elon Musk accepts Dogecoin as a payment method for Tesla vehicles.
Coinbase teased crypto fans with the possibility that their first leveraged futures contracts for Bitcoin Cash, Litecoin, and Dogecoin could be accessible on multiple trading platforms. The exchange platform encouraged investors to keep an eye out for these leveraged futures contracts as they would soon be available for trade on partner platforms as well (see Figure 3).
“Stay tuned to find out when these contracts will be available to trade on our partner platforms.”
Figure 3: Coinbase Institutional encourages investors to watch for upcoming futures contracts on partner platforms.
This development is a monumental step forward for crypto enthusiasts and marks a crucial milestone towards broader adoption and increased accessibility for digital assets.
Going Deeper: Behind the Scenes
On March 7, 2024, Coinbase Derivatives filed a request to list new futures contracts with the US Commodity Futures Trading Commission (CFTC). The regulatory process, however, was anticipated to involve delays. Despite these expectations, Coinbase planned to launch the products regardless, as they believed the leveraged contracts adhered to the legal guidelines set forth by the CFTC (see Figure 4).
“Coinbase Derivatives filed a request to list new Futures contracts to the US Commodity Futures Trading Commission (CFTC) on March 7th.”
Figure 4: Coinbase Derivatives files a request for new futures contracts with the US Commodity Futures Trading Commission.
In their application to list Dogecoin futures, Coinbase highlighted that this altcoin had proven its longevity and growth beyond its meme coin origins (see Figure 5).
“In Coinbase’s application to list Dogecoin Futures, it stated that the Doge cryptocurrency has withstood the test of time and undoubtedly grown beyond its reputation as a memecoin.”
Figure 5: Coinbase’s application emphasizes Dogecoin’s growth and longevity.
The cryptocurrency’s popularity has surged even further following the announcement, as evidenced by the sharp (18%) increase in DOGE price.
Coinbase’s Vision and Mission
Coinbase has long been toying with the concept of crypto-leveraged derivatives. Back in 2022, the platform publicly announced its intentions to make cryptocurrency derivatives contracts accessible to retail investors (see Figure 6). In line with its mission, Coinbase reportedly acquired FairX, a derivatives exchange platform that is regulated by the CFTC.
“Coinbase, one of the largest crypto exchange platforms in the market is continuing to drive cryptocurrency adoption through different products.”
Figure 6: Coinbase’s mission to drive cryptocurrency adoption through various products.
The crypto community and investors alike are eagerly awaiting the availability of these CTFC-regulated derivatives for Bitcoin Cash, Litecoin, and Dogecoin come April 1st. This development is seen as a significant stride towards increasing mainstream adoption of these popular cryptocurrencies.
