Coinbase is shaking up the US derivatives market by announcing plans to offer 24/7 Bitcoin and Ethereum futures trading.
The move, announced on March 10, introduces perpetual futures contracts with long-date expirations, marking a significant shift for US traders who have long dealt with restricted trading hours and expiring contracts.
By entering the crypto-futures space with a continuous trading model, Coinbase is positioning itself as a direct challenger to traditional financial giants and offshore crypto exchanges.
The US has lagged behind other regions in crypto derivatives, largely due to regulatory uncertainty. Most crypto futures trading happens outside the country, leaving American traders with fewer options and fixed-hour markets that create inefficiencies.
Futures contracts allow traders to speculate on the future price of an asset without directly owning it. Perpetual futures, or “perpetuals,” differ by having no expiration date, making them popular among crypto traders seeking long-term exposure without constant contract rollovers.
Coinbase’s expansion into this market signals a major shift in accessibility for US traders, potentially increasing market liquidity and price discovery efficiency.
Regulatory Roadblocks and Coinbase’s Strategy
One of the biggest hurdles in launching crypto perpetual futures in the US has been uncertain regulatory oversight.
Coinbase addressed this concern in its announcement, stating that it is actively working with the Commodity Futures Trading Commission (CFTC) to ensure its offerings comply with existing US regulations.
The CFTC is responsible for overseeing the trading of commodities-based derivatives, including perpetual contracts, to prevent market manipulation and ensure transparency.
Given the increasing demand for regulated crypto derivatives in the US, Coinbase’s move could set a precedent for more exchanges to enter the space if it gains regulatory approval.
A Growing $1.3 Trillion Market
Crypto derivatives dominate the digital asset trading landscape, with a staggering $1.3 trillion in monthly trading volume as of September 2023, according to Alpha Point.
For centralized derivatives, non-US markets still lead in volume, showing that US-based exchanges have room to grow if they can navigate the regulatory environment effectively.
Coinbase’s 24/7 futures trading aims to capture a significant share of this booming market, bringing more competitive options to traders who have historically relied on offshore platforms.
While Coinbase’s move is bold, it enters a market already controlled by financial heavyweights like the CME Group.
- CME Group, a dominant force in the US derivatives industry, reported $6.1 billion in revenue in 2024 and saw an average daily crypto derivatives trading volume of $10 billion in Q4 2024.
- However, CME’s derivatives are only available six days a week, giving Coinbase a potential advantage with its uninterrupted 24/7 trading cycle.
Beyond CME, Robinhood is also stepping into the crypto derivatives space, announcing in January its own plans to offer Bitcoin and Ethereum futures.
Meanwhile, Coinbase already operates a regulated crypto derivatives platform under Coinbase Financial Markets, which will likely serve as the foundation for its expanded futures offerings.
The launch of 24/7 Bitcoin and Ethereum futures in the US could have major ripple effects, including:
- Increased market liquidity – Continuous trading allows for more efficient price discovery and reduces gaps caused by market closures.
- Greater institutional interest – With regulated futures available at all times, hedge funds and institutional investors may increase exposure.
- More volatility or stability? – While added liquidity can smooth out price swings, an influx of leveraged derivatives trading could also amplify volatility.
The Future of US Crypto Derivatives
Coinbase’s expansion into 24/7 crypto futures signals a growing shift toward regulatory acceptance of digital asset derivatives.
While the exchange must navigate CFTC regulations and fend off competition, its move could pave the way for broader adoption of perpetual futures in the US.
For now, the crypto market is watching closely. If successful, Coinbase’s bold step could redefine how American traders engage with digital assets bringing them closer to the non-stop pace of the global crypto economy.
