Coinbase Considers Acquiring FTX Europe: A Bold Move To Supercharge Crypto Derivatives

Key Points:

• Coinbase considers acquiring FTX Europe to boost its derivatives business.
• Regulatory hurdles drive Coinbase and others toward offshore markets.
• Coinbase’s interest in FTX Europe wanes as it gains U.S. approval for crypto derivatives.

Crypto exchange giant Coinbase is reportedly considering the acquisition of FTX Europe as part of its strategy to expand its global presence in the crypto derivatives market, according to Fortune. Other potential suitors for FTX Europe include Crypto.com. However, negotiations for the acquisition have not yet advanced to the final stages.

Coinbase Considers Acquiring FTX Europe to Expand Plans in Crypto Derivatives Market

Coinbase’s interest in the exchange emerged following the exchange’s declaration of bankruptcy in November. While talks of acquisition never progressed significantly, it underscores Coinbase’s growing emphasis on derivatives amidst a decline in spot trading volumes during the recent bear market.

In Europe, regulatory uncertainties persist regarding crypto derivatives, making FTX Europe’s collapse in November significant. The platform, known for offering perpetual futures (perps), had a pivotal Cypriot regulatory license that allowed it to cater to the European market. Various buyers expressed interest in the license, but it could only be transferred through an acquisition.

Regulatory Challenges Prompt Coinbase to Explore Offshore Opportunities

Coinbase has shown intermittent interest in FTX Europe, as documented in messages dating back to November 2022 and early September 2023. However, recent reports suggest that Coinbase is no longer actively pursuing this potential acquisition.

Last month, Coinbase received approval to directly offer cryptocurrency derivatives to retail consumers in the U.S., a move it had been working on for nearly two years. This approval enhances Coinbase’s position in the derivatives market, further solidifying its commitment to this sector.

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