Coin Edition -
- Coinbase (NASDAQ:COIN) submits a letter to the CFTC detailing futures contracts for Dogecoin, Litecoin and Bitcoin Cash.
- The contracts, if approved, will allow traders to speculate on crypto prices without owning the underlying assets.
- Analysts speculate on SEC response suggesting Coinbase may challenge securities classification with this move.
A member of the crypto community pointed out that Coinbase has formally submitted a proposal to the Commodity Futures Trading Commission (CFTC) regarding the introduction of futures contracts for Dogecoin, Litecoin, and Bitcoin Cash.
Coinbase Derivatives LLC quietly filed certifications with CFTC to list US regulated futures for Dogecoin, Litecoin and Bitcoin Cash.They filed them on March 7 and surprisingly nobody seemed to notice.Futures are set to start trading on April 1 if there are no objections from… pic.twitter.com/DYbWjuS6G2— Summers (@SummersThings) March 20, 2024
Directed to CFTC Secretary Christopher Kirkpatrick in a letter dated March 7, Coinbase outlined comprehensive details about these proposed contracts, including their sizes, settlement methods, and overall structure.
These futures contracts, if approved, will be cash-settled and are scheduled to begin trading on April 1st. By providing exposure to the price movements of these cryptocurrencies without necessitating the ownership of the underlying assets, Coinbase aims to attract a larger number of traders to its platform.
This classification introduces intriguing discussions about the regulatory status of other cryptocurrencies, especially in the context of futures trading. However, this move by Coinbase has increased speculation about potential challenges from the Securities and Exchange Commission (SEC) also leaving a cloud of uncertainty looming over the exchange’s strategic decision.Another famous Bloomberg crypto analyst pointed out that Coinbase’s initiative might serve as a challenge to the SEC’s stance on cryptocurrencies utilizing the same proof-of-work consensus mechanism as Bitcoin. This bold step not only reflects Coinbase’s confidence in the market demand for such instruments but also sets the stage for a potential clash between regulatory bodies and cryptocurrency exchanges regarding the classification and treatment of digital assets.
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