Coinbase: the crypto-exchange aims at Europe to expand its derivatives offering

The famous crypto-exchange Coinbase is exploring how to expand its derivatives offering in Europe. 

In this regard, Coinbase announces that it is about to acquire a MiFID (Markets in Financial Instruments Directive) authorized entity based in Cyprus from the European Union. 

Coinbase: the crypto-exchange acquires an entity in Cyprus to expand the offering of derivatives in Europe

In its blog post, Coinbase has revealed its intention to acquire an entity in Cyprus to expand its derivatives offering in Europe.

The famous crypto-exchange is looking for a way to obtain the license from the European Union MiFID (Markets in Financial Instruments Directive), in order to fulfill its mission of global expansion. 

In this regard, here is how Coinbase describes the addition of this license to its international portfolio:

“MiFID has established a single and comprehensive regulation throughout the EU and is a central pillar of the EU’s Capital Markets Union strategy. Adding such a license to our international portfolio would further support the strong interest we have seen for our derivative offerings and help us capture a larger share of the approximately 75% of the global cryptocurrency market claimed by derivatives.”

The operation is subject to regulatory approval and is expected to be completed by 2024.

Coinbase: strategy and standards of the crypto-exchange for its derivatives expansion in Europe

In order to fulfill this mission, Coinbase relies on its strategy “Go Broad, Go Deep”, along with its “Five-point Global Compliance Standard,” which in 2023 seems to have been helpful for the launch of new operations and derivative products.

In practice, the “Go Broad, Go Deep” strategy is building a clear track of rules, licenses, and registrations to make international expansion possible. 

On the other hand, the “Five-point Global Compliance Standard” aims to ensure that Coinbase’s products and services are the most reliable on the market. 

Specifically, the five points would be: 1) an experienced and trusted team; 2) industry-leading AML and KYC standards; 3) enforcement of global sanctions; 4) best governance practices; and 5) rigorous and continuous monitoring and reporting. 

Coinbase underlines that this “Five-point Global Compliance Standard” has been designed and supervised by its global team. It consists of over 400 compliance and legal professionals with decades of experience gained at the FBI, DOJ, OFAC, FinCEN, Scotland Yard, major banks, and other important regulatory authorities. 

Registration as a VASP in France

Just before Christmas 2023, the news arrived that Coinbase had obtained the PSAN registration, the French acronym for VASP, which stands for Virtual Asset Service Provider in France.

Thanks to this license, Coinbase will be able to offer its suite of crypto products and services to retail, institutional, and ecosystemic users in France. 

In this regard, the famous crypto-exchange has added that this registration represents a milestone in its international expansion journey. 

This is indeed the possibility of being able to offer the French completely regulated services such as custody of digital assets, buying and selling, and exchanging.