Coinbase Launches U.S.-Regulated Perpetual Futures for Bitcoin and Ether

Coinbase Global Inc. is set to launch U.S.-regulated perpetual-style futures for Bitcoin and Ether starting July 21. This move positions Coinbase as one of the first exchanges to offer such regulated perpetual futures contracts in the United States, a market that has been largely dominated by offshore platforms. These offshore exchanges, despite representing a significant portion of global crypto trading activity, have introduced various risks including regulatory, custody, and counterparty issues for U.S.-based traders.

The new offerings include nano Bitcoin (0.01 BTC) and nano Ethereum (0.10 ETH) perpetual-style futures contracts. These contracts are designed to closely track spot prices while providing leverage, all while remaining fully compliant with CFTC regulations. Coinbase CEO Brian Armstrong expressed excitement about the launch, stating, "You asked for it, we built it."

Perpetual-style futures are a type of crypto derivative that mimic standard futures contracts but do not have a fixed expiration date. This allows traders to take long or short positions with leverage while tracking the underlying asset's price. These contracts have become dominant in global crypto trading but have been largely unavailable in the U.S. market due to regulatory restrictions. The new contracts will function as long-dated futures with five-year expirations, incorporating hourly funding mechanisms to maintain spot price alignment through 24/7 trading.

The launch of these perpetual-style futures aligns with what appears to be a crypto-friendly shift under the current administration, encouraging innovation through lighter regulatory pressure. This move is seen as a transformative milestone for the domestic market, providing a regulated alternative to offshore derivatives.

Coinbase's stock has seen a significant surge, hitting an all-time high of $375.07 on Thursday. This rise reflects growing public market interest in crypto-native companies. The exchange became the first crypto firm to join the S&P 500 in May and has seen its stock price climb 50% year-to-date from $256 in January. The success of Circle going public has also signaled investor confidence in the long-term value of regulated crypto infrastructure. An analyst at an investment bank has raised his price target for Coinbase to $421, citing the company’s European expansion and USDC integration.