Coin Edition -
- Coinbase (NASDAQ:COIN) has received regulatory approval to enable retail perpetual futures trading.
- Linda P. Jones explained the implications of the approval for XRP.
- Jones thinks the approval will lead to an influx of institutional money.
Coinbase, the leading crypto exchange, has received regulatory approval to enable retail perpetual futures trading for eligible non-US customers. In a post on X (formerly Twitter), Linda P. Jones, author of the book “3 Steps to Quantum Wealth” explained the implications of this approval for XRP futures trading on the crypto exchange.
Coinbase approving perpetual futures contracts for trading XRP means:1) XRP is very bullish. If XRP's price was not going to fluctuate or change a lot, no one would be interested in trading it. Futures contracts allow for maximum leverage and can lead to outsized profits (or…— Linda P. Jones (@LindaPJones) October 18, 2023
According to Jones, there are three significant implications for this development, the first of which she argued would lead to a bullish season for XRP. Jones believes that if XRP’s price didn’t fluctuate or change significantly, no one would be interested in trading it. She explained that futures contracts allow for high leverage and can lead to outsized profits (or losses).
Another notable implication for this approval is an influx of institutional money. Jones believes institutional investors will want to trade on the volatility of XRP, and this will contribute to a bullish trend for the token. The renowned author argued that the significance of Coinbase’s latest development is in the influx of institutional, rather than retail investors it could bring into the market. According to her, it is Wall Street firms, mostly hedge funds, that engage in the trading of futures contracts.
Jones noted that Coinbase’s secrecy about the countries approved to trade the contracts means it may be Bermuda, the Cayman Islands, or other jurisdictions for hedge funds and offshore funds.
On September 28, Coinbase announced via a blog post that it had received regulatory approval from the Bermuda Monetary Authority (BMA) to enable perpetual futures for eligible non-US retail customers. The leading crypto exchange promised to operate with maximum transparency, employ a robust risk framework and meet the high-bar regulatory and compliance standards of the BMA.
According to Coinbase, it will start offering eligible customers access to regulated perpetual futures contracts in the coming weeks on its Coinbase Advanced platform.
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