On 1 August, Coinbase’s international version, namely Coinbase International Exchange, launched two new crypto perpetual futures contracts.
These are futures on the price of XRP (Ripple) and the price of LTC (Litecoin).
In the first seven trading days alone, more than $43.7 million in trading volume was recorded on the international version of Coinbase’s exchange.
Summary
Coinbase International Exchange
Coinbase International Exchange, which is the version of Coinbase dedicated specifically to countries other than the United States, is for all intents and purposes a separate crypto exchange, although effectively run by the same corporate group.
Its web address is international.coinbase.com, instead of coinbase.com, and so far it hosts only four perpetual futures.
The first two were BTC-PERP, on the price of Bitcoin, and ETH-PRP, on that of Ethereum, but XRP-PERP and LTC-PERP have also recently been added.
Coinbase International Exchange was launched only this year, in response to issues raised by US authorities against the exchange.
It is worth mentioning that the United States of America does not yet have clear and specific regulation of crypto markets, as is the case in other countries, and this greatly limits the actions of US crypto exchanges, or exposes them to the risk of violating some regulation.
The fact that there are only four perpetual future contacts on the international version of Coinbase for now suggests that it is far from being the mainstream version. What’s more, the US version also features spot trading pairs, of course, which are usable by customers from almost everywhere else in the world.
Volumes
Taking daily volumes as a reference, in the past 24 hours Bitcoin futures on Coinbase International Exchange have totaled a trading volume of more than $127 million, which is significantly more than the others.
Ethereum futures have only totaled $65.5 million in trading in the last 24 hours, which gives a good idea of how much Bitcoin is dominating the crypto markets right now, and especially how dominant it is on Coinbase.
Futures on XRP stopped at $7.3 million, and futures on LTC at $3.3 million.
In the latter two cases, these are very small volumes, despite the fact that both cryptocurrencies debuted on the crypto markets years before Ethereum.
As for monthly volumes, over the past 30 days, contracts on Bitcoin on Coinbase International Exchange have nearly reached $1.4 billion in trading, while those on ETH have stopped below 900 million.
It is worth noting that these are much lower trading volumes than those on other major exchanges that also offer buying and selling of perpetual futures.
For example, in the past 24 hours on Binance, perpetual futures contracts on the price of Bitcoin have exceeded well over $1.8 billion, which is more than what was totaled in one month on Coinbase International Exchange.
It is worth noting that Coinbase’s international exchange was launched only very recently, and is not aimed at Coinbase’s main market, which is the US market.
Crypto news: perpetual futures contracts
Futures contracts are financial products that allow the underlying asset to be bought or sold not immediately, but at a future date.
They are usually terminated on the scheduled expiration date, but those called “perpetuals” have no expiration date.
Hence perpetual futures allow people to sell or buy in the future freely, at any given date.
Futures contracts are used either to bet on the future price of a given asset, or to hedge against future losses due to unexpected movements.
In crypto, they are widely used mainly for two reasons.
The first, and most important, is that they make it easy to also bet on price declines, and not just increases. In other words, they allow you to “short” the price of a cryptocurrency, so that you can make money if its market value falls.
The second is that they allow leveraged trading, that is, borrowing a portion of the capital to be invested (usually a majority of the capital).
The two combined make futures highly used by those who trade cryptocurrency prices intraday.
What’s more, they do not require having to deal with the custody of tokens, since they are merely contracts and not tokens.
Coinbase is certainly not one of the preferred exchanges for those who want to trade cryptocurrency futures contracts, but in the event that it opens the service to the US as well in the future, a surge in volumes can be expected.
