Coinbase Launches U.S. Compliant Perpetual Futures Contracts July 21

Coinbase is set to launch a new suite of American-style perpetual futures contracts on July 21, marking a significant development in the U.S. cryptocurrency market. These contracts are designed to closely track spot prices, offer leverage, and comply with U.S. regulatory standards, providing traders with a secure and compliant trading environment within the United States. The new contracts will include a nano Bitcoin contract at 0.01 BTC and a nano Ether contract at 0.10 ETH, engineered to function similarly to global perpetual futures but under U.S. regulatory oversight. They feature five-year expirations and will trade 24/7, providing traders with continuous access to the market. The contracts also include a funding rate mechanism that keeps the futures prices synced with the spot market, with funding building up every hour and settling twice per day. This mechanism ensures that the futures prices remain closely aligned with the spot prices, providing traders with a more accurate reflection of market conditions.

Coinbase’s move is a strategic play to capture a market that has, until now, existed largely in regulatory limbo. Perpetual futures dominate crypto trading globally, yet U.S. traders have been locked out of this liquidity, forced to either accept clunky, expiration-bound contracts or take their business to offshore exchanges where regulatory oversight is minimal and counterparty risk remains high. With its new five-year expiring contracts, Coinbase is attempting to repackage the perpetual model in a way that fits within U.S. legal parameters. Unlike traditional futures, which reset quarterly and often drift from spot prices, Coinbase’s contracts apply hourly funding payments to tether positions closely to market rates. Traders pay or receive funding every 12 hours based on long or short positioning, a system borrowed from offshore perpetuals but streamlined for U.S. compliance. The nano sizing (0.01 BTC and 0.10 ETH) lowers the barrier to entry, appealing to retail traders who might otherwise avoid futures entirely. Critically, the five-year expiration is a nod to long-term holders. Most crypto derivatives require rollovers every few months, creating friction for multi-year strategies. By minimizing expiration pressure, Coinbase is betting that traders will prefer holding these contracts over juggling quarterly expiries or risking exposure on offshore platforms.

If successful, Coinbase’s initiative could pressure rivals to launch similar hybrid instruments, reshaping the U.S. crypto derivatives landscape. The launch of these contracts is part of Coinbase's broader strategy to deepen its footprint in both consumer spending and derivatives trading. In addition to the new futures contracts, Coinbase is also rolling out a Bitcoin rewards credit card this fall. The card will offer up to 4% back in BTC for premium subscribers, with rewards paid directly into Coinbase accounts. This move is designed to appeal to those already in the Coinbase ecosystem, providing them with an easy way to accumulate Bitcoin through everyday purchases. However, the new credit card comes with its own set of risks. Unlike traditional cashback cards, the rewards are paid in Bitcoin, which is subject to market volatility. This means that the value of the rewards can fluctuate, adding an element of risk to the card's benefits. Additionally, the card comes with the usual credit risks, including high interest rates, debt buildup, and personal data exposure. Coinbase has emphasized that its platform has never lost any customer funds to wallet breaches, and that card rewards are deposited into Coinbase wallets, not external providers.

The launch of these new products is a significant step for Coinbase as it seeks to expand its offerings and attract more traders to its platform. By providing a regulated, domestic alternative to offshore perpetual futures, Coinbase is positioning itself as a leader in the cryptocurrency derivatives market. The new contracts and credit card are designed to appeal to a wide range of traders, from those looking for leverage and capital-efficient trading to those seeking to accumulate Bitcoin through everyday purchases. With these new offerings, Coinbase is well-positioned to capture a larger share of the cryptocurrency market and continue its growth as a leading exchange.