Coinbase seeks regulatory green light for perpetual futures on individual US stocks
The crypto exchange has submitted a proposal to regulators for around-the-clock perpetual futures contracts on individual American equities, offering 24/5 trading availability pending CFTC approval.
Through its derivatives arm, Coinbase has submitted an application to the Commodity Futures Trading Commission requesting authorization to offer perpetual futures contracts on individual equities within the United States, aiming to introduce a derivatives instrument commonly utilized in cryptocurrency trading to the US stock market.
Filed on Friday via Coinbase Derivatives, the application requests approval from regulators for financial instruments that would allow American traders to gain round-the-clock access to individual equities without the need to purchase the actual shares. Unlike conventional futures agreements, perpetual futures contracts have no expiration date.
According to Coinbase, these new financial products would represent an expansion of the company's current perpetual futures marketplace in the US, applying the framework that has been used for digital assets to traditional equities. The CFTC has classified the proposed instruments as single-stock futures, which are currently under review awaiting regulatory clearance.
According to a Friday report from The Wall Street Journal, Coinbase's initial launch would feature perpetual futures contracts linked to approximately 50 to 60 individual equities, with names like Apple, Microsoft, Tesla and Nvidia among those included.
This submission to the CFTC comes after Coinbase Derivatives took an earlier regulatory action, submitting a Form 1-N to the Securities and Exchange Commission on Sept. 1 seeking registration as a national securities exchange with the specific intention of providing security futures products.
For qualified traders located outside of the United States, Coinbase has been providing stock perpetual futures since March, when it introduced the product with contracts based on prominent US equities and market indexes, featuring companies such as Apple and Nvidia. When the international product was launched, the company indicated that US persons were not permitted to access these products but noted that efforts were underway to bring the offering to more geographic markets.