20 April: Coinbase Global Inc (COIN.O), one of the largest U.S. crypto exchanges, has secured a licence to operate in Bermuda as part of its global expansion strategy.
The move comes amid growing regulatory pressure on crypto firms in the U.S., where the Securities and Exchange Commission (SEC) has threatened to sue Coinbase over some of its products.
Coinbase CEO Brian Armstrong said on Tuesday that crypto firms will develop in “offshore” havens unless the U.S. and UK create “clarity about regulation” for crypto.
Crypto derivatives trading
Coinbase has obtained a licence from the Bermuda Monetary Authority, which allows it to operate as a digital asset business there, it said in a blog post on Wednesday.
The exchange is also in discussion with financial regulators in Abu Dhabi about a potential licence, the blog said.
According to Fortune, Coinbase is planning to launch a crypto derivatives exchange in Bermuda as soon as next week, citing a person close to the company.
Crypto derivatives trading is big business. In March, derivatives trading volumes on major exchanges hit some $2.8 trillion, versus spot trading volumes of just over $1 trillion, according to London researcher CCData.
Regulatory compliance
U.S. SEC Chair Gary Gensler told lawmakers on Tuesday that he had “never seen a field that’s so non-complying with laws”.
Crypto firms say they need clarity about regulations, but Gensler has said that crypto markets “suffer from a lack of regulatory compliance, not a lack of regulatory clarity”.
A spokesperson for Coinbase told Reuters on Thursday the company had “nothing to announce today regarding our future plans to offer services through this license.”
Bermuda’s regulator did not immediately respond to a request for comment sent outside business hours.