Coinbase will buy a company in the EU to launch crypto derivative trading services

The deal is expected to be approved by regulators later this year

08.01.2024 - 08:10

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4 min

What’s new? US crypto exchange Coinbase plans to expand its business in the European Union by starting to offer cryptocurrency derivatives trading services. To this end, it will buy a local company that has a MiFID II license to operate financial instruments in the bloc. Coinbase officials told CNBC that the exchange has already struck the necessary deal to buy the unnamed holding firm, which is expected to be approved by regulators later this year.

CNBC’s material

What else is known? By obtaining a MiFID II license, Coinbase will be able to start offering regulated derivatives such as futures and options to EU clients. The company already offers spot trading of bitcoin and other cryptocurrencies on the local market.

The company began developing its crypto derivatives business in May, launching a dedicated international trading platform headquartered in Bermuda. In November, it received authorization from the National Futures Association (NFA) to offer such services to clients in the US.

In October, Coinbase chose Ireland as its primary hub in the EU’s Markets in Crypto Assets (MiCA) Act territory and applied for a single MiCA license, which it hopes to receive by December 2024.

Central Bank of Ireland has included Ripple in the register of virtual asset service providers

The company chose the country as its main hub in the EU because of favorable working conditions

In late December, Coinbase received a Virtual Asset Service Provider (VASP) license in France, which gives it permission to offer storage and trading of crypto assets.

Coinbase began its global expansion in the wake of pressure from US securities regulator SEC, which accused the exchange of trading unregistered securities. Coinbase CEO Brian Armstrong said that the exchange had held 30 meetings with SEC officials, but was never able to figure out what principle they used to determine whether a particular cryptocurrency was a security.

In 2023, Coinbase’s venture capital arm topped the ranking in terms of number of transactions. The exchange invested in 47 projects, including analytics platform Arkham Intelligence and staking protocol Rocket Pool. Coinbase also topped the top in terms of crypto lobbying spending in the United States.