Coinbase is looking at a separate, overseas crypto trading platform
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Coinbase plans to set up a new trading platform outside the US, according to reports.
The exchange has announced plans to accelerate its “Go Broad, Go Deep” international strategy over the next two months, launching new products and services in markets on six continents.
Coinbase has begun talking to its existing international customers, including market makers and institutional investment firms, about setting up a separate platform headquartered outside the US, Bloomberg reported.
While Coinbase already operates in more than 100 countries, all of these subsidiaries send customers to the same US trading platform.
With a 24-hour trading volume of $2.8 billion in the last 24 hours, Coinbase is currently the second largest spot exchange by volume – although it is a distant second behind Binance, which had 11 times the volume. CoinMarketCap is owned by Binance.
But that’s hardly in the very lucrative crypto derivatives business with its new Coinbase Derivatives Exchange, a Commodity Futures Trading Commission-regulated platform it bought in January 2021. That would change with the new global trading venue, which will offer derivatives as well as spot. trade, sources tell The Block.
An internationally headquartered platform would also offer the company an alternative to the United States, which is engaged in a regulatory crackdown that intensified with the bankruptcy of Sam Bankman-Fried’s FTX exchange and doubled last week with the collapse of three crypto-related banks, including the two most important, Silvergate Bank and Signature Bank.
And that comes after a terrible 2022. The Nasdaq-listed exchange saw a net loss of $2.6 billion on revenue of $3.15 billion — well under half of 2021’s $7.35 billion.
The new platform will focus on “high-bar regulatory jurisdictions,” Coinbase said. That will include the UK, Singapore and the EU, where the Markets in Crypto Assets (MiCA) regulatory package just passed.
A week after its recent “Go Broad, Go Deep” announcement, Coinbase pointed to the UK as a potential global crypto hub.
It said recent moves by the Treasury and Exchequer show “that they are delivering on this commitment and recognize that digital assets and crypto will be a key pillar in future-proofing the competitiveness of the UK’s financial centres.”
Other destinations mentioned as targets to become crypto hubs in the “Go Broad, Go Deep” announcement were Brazil, UAE, Australia, Hong Kong, Switzerland, Bermuda and Japan.
Coinbase CEO Brian Armstrong has long cultivated a strong relationship with regulators, and has argued that strong, clear regulation will be good for crypto. In early March, he called building an American regulatory framework “a matter of national security.” Without one, Armstrong said:
He has clashed with regulators several times recently, most notably over a series of issues related to the Securities and Exchange Commission’s (SEC) claim that nearly every cryptocurrency is a security.
Return-bearing staking accounts like Coinbase Earn are another, with Armstrong saying earlier this month that he is “hearing rumours” that staking could be banned outright – and vowing to fight such a ruling in court.