- Coinbase Derivatives Exchange is launching “institutional-sized” Bitcoin (BTI) and Ether (ETI) futures contracts aimed at meeting increasing demand from institutional investors.
- Each BTI and ETI futures contract is sized at 1 BTC and 10 ETH respectively, offering lower fees than traditional offerings and facilitating greater precision.
- The contracts will be settled in U.S. dollars monthly, allowing institutional traders to use them for various strategies.
As the cryptocurrency space continues to evolve and mature, institutional involvement has taken center stage as a critical driver in legitimizing the market. A significant milestone in this journey has just been achieved with Coinbase Derivatives Exchange’s announcement to launch “institutional-sized” Bitcoin and Ethereum futures.
Addressing the growing need for advanced crypto investment products, Coinbase Derivatives Exchange, regulated futures offering by the popular crypto exchange, Coinbase, is set to roll out its Bitcoin (BTI) and Ether (ETI) futures contracts for institutional clients starting from June 5th, 2023. This move comes as a response to increasing institutional demand following the successful launch of Coinbase’s nano Bitcoin (BIT) and nano Ether (ETI) contracts last year. The new futures contracts are more significant, explicitly designed for institutional investors, and are intended to enable greater precision in managing crypto exposure.
Each BTI and ETI futures contract is sized at 1 BTC and 10 ETH, respectively, providing institutions with the ability to tailor their exposure to these growing digital asset commodities with granularity. Furthermore, these contracts come with significantly lower fees than traditional offerings, aiming to foster greater accessibility and participation. At current market prices, BTI and ETI contracts hold a notional value of $30,000 and $20,000, respectively.
Providing Tools for More Complex Trading Strategies
These new contracts will be settled in U.S. dollars monthly, thus allowing institutional traders to employ them in various ways – from hedging market bets and expressing long-term market views to even utilizing them in complex trading strategies. Coinbase’s commitment to providing innovative solutions that cater to the specific needs of institutional investors is exemplified in these offerings, marking a significant milestone in the crypto derivatives market.
Moreover, Coinbase Derivatives Exchange has formed partnerships with leading institutional futures commission merchants (FCMs), brokers, and front-end providers to facilitate seamless access to these futures contracts. This strategic move ensures that these advanced financial instruments are easily accessible via robust trading platforms, further simplifying the process for institutional clients.
A Game-Changer in the Crypto Derivatives Market
Launching these institutional-sized contracts is a significant development in the cryptocurrency ecosystem. The crypto derivatives market, a popular, albeit mostly unregulated, sector, has seen over $134 billion in notional volume traded across exchanges in the past 24 hours alone. Bitcoin and Ether-tracked products constituted over $25 billion of these volumes.
The launch of institutional-sized Bitcoin and Ethereum futures on Coinbase Derivatives Exchange demonstrates traditional financial institutions’ growing acceptance of cryptocurrency as a legitimate asset class. As Coinbase leads the way with significantly lower fees for their futures contracts, this initiative will likely benefit institutional investors and the overall crypto ecosystem by promoting greater participation and liquidity in the market.
