Coinbase Buys Derivatives Exchange FairX, Describes The Move As A 'Stepping Stone' To Offering Crypto Derivatives In US

Coinbase Global Inc COIN said Wednesday it is buying the U.S. Commodity Futures Trading Commission-regulated derivatives exchange FairX.

What Happened: The trading platform said in a statement that the acquisition “is a key stepping stone on Coinbase’s path to offer crypto derivatives to retail and institutional customers in the US.”

“Deep and liquid derivatives markets are essential to the functioning of traditional capital markets. These products are in high demand from investors who seek to effectively manage risk, execute complex trading strategies, and gain exposure to crypto outside of existing spot markets,” said Coinbase.

No information regarding the purchase price was made available in Coinbase’s statement. The exchange said the acquisition is subject to customary closing conditions and reviews, and the deal is expected to close in Coinbase’s first fiscal quarter, which ends March 31.

Coinbase’s shares rose 3% to $241.75 in the after-hours trading on Wednesday. The shares ended the regular session 1.1% lower at $234.70.

Why It Matters: Coinbase is the second-largest cryptocurrency exchange by volume behind Binance in terms of spot trading.

Coinbase has more than 73 million users across the world, according to its Transparency Report dating back to December.

The top three spot exchanges, according to CoinMarketCap data, recorded a 24-hour trading volume of $45.1 billion.

On the other hand, the top three derivatives exchanges recorded trade volumes of $77 billion in the same time period.

The Changpeng Zhao-led Binance is the top derivatives exchange by volume. Over 24 hours, Binance recorded a trading volume of $52.62 billion.

In December, Crypto.com purchased the North American Derivatives Exchange Nadex.

Photo: Courtesy of Coinbase

Market News and Data brought to you by Benzinga APIs

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

-

Comments