Coinbase Gets Regulatory Green Light For Offshore Exchange, Launches Soon
Coinbase, the largest US crypto exchange, received a Class F license from the Bermuda Monetary Authority (BME) under the Digital Asset Business Act a day after reporting its possible relocation.
The crypto community is speculating about how the exchange will handle the scrutiny of US crypto regulations without moving. Following authorization, Coinbase may set up an offshore futures exchange platform next week. Perpetual swaps related to Cryptocurrencies can be traded offshore.
The study states that Coinbase can sell and issue tokens under its Class F license. This authorizes Coinbase to trade digital assets and offer derivatives. The exchange chose Bermuda as one of its foreign hubs because of its financial regulatory experience.
Coinbase said: Bermuda was one of the first financial centers to pass full digital asset regulation in 2018, and its regulatory framework is known for rigor, transparency, compliance and cooperation.
The corporation announced this alongside a “global scale to expand and deepen” update. Coinbase will create “regulated entities and local operations” to expand globally. It is also making progress with companies in Brazil, Canada, Singapore, Europe and the UAE.
US crypto exchange: We will collaborate with governments and authorities in various regions to become the most trusted and compliant crypto company in any market, just like we do in the US. Coinbase CEO Brian Armstrong advocated for clearer US and UK cryptocurrency rules on Tuesday. Armstrong claims that without such laws, corporations could thrive in “offshore paradises” with less control and regulation.
The Innovate Finance industry summit revealed this. Armstrong said the demise of the Bahamas-based exchange FTX last year demonstrated the need for clearer standards. The CEO thinks offshore sites with less regulation threaten the authenticity of cryptocurrencies.
Governments are scrambling to regulate the global rise of cryptocurrencies. Due to a lack of an established legal framework, governments regulate bitcoin differently, leaving many companies in a regulatory gray zone. This makes it difficult for companies like Coinbase to function legally and efficiently.
Armstrong has encouraged the US and UK to set an example and establish clear cryptocurrency regulations. Cryptocurrencies can gain legitimacy and growth if both countries make appropriate business regulations.
As cryptocurrencies become more popular, governments must establish clear and transparent rules to protect investors and support legitimate growth. The latest news may affect the crypto sector. Global crypto market cap fell 5% to under $1.2 trillion in 24 hours.