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The Commodity Futures Trading Commission (CFTC) of the United States has registered Coinbase Clearing LLC as a derivatives clearing organization.

Coinbase currently holds all three licenses: exchange, futures broker, and clearinghouse.

However, the single-share perpetual contracts that the company is about to launch will still be settled by existing partners.

Coinbase has been approved to liquidate derivative transactions on its own and to complete three federal registrations, thereby enabling this crypto exchange to operate end-to-end futures services without the need to rent any of these components.

On Monday, the Commodity Futures Trading Commission (CFTC) of the United States registered Coinbase Clearing LLC as a derivatives clearing organization. The company previously held two other qualifications: Coinbase Derivatives and LLC as designated contract markets, as well as Coinbase Financial Markets and Inc as futures brokers.

Having a clearinghouse will change the products that Coinbase can build. The company stated in a statement: "This is the first time we have been able to directly create and settle fully collateralized contracts." The company expects that this will mean faster product development, as well as reduced reliance on external parties when launching new products.

Using USDC as liquidation collateral

Coinbase calls it the first native USDC clearing house, using this stablecoin as collateral to achieve 24-hour settlement; the company describes this design as "tailored for a market that never stops in the future."

Traditional clearing houses rely on cash and U.S. Treasury bonds for settlement, which is conducted according to the bank calendar. Accepting stablecoins as collateral means that there is no reason for derivative trading venues to stop trading on weekends.

Coinbase Clearing deals with fully collateralized contracts; therefore, its margin derivatives business, as well as the planned launch of perpetual contracts for individual stocks of Apple, Tesla, and NVIDIA, will still be settled through existing partners.

The company's Chief Legal Advisor, Molly Abraham, stated: "Today's CFTC approval has completed the Coinbase end-to-end derivatives infrastructure."

Cryptocurrency Exchanges and Derivatives

The parent company of competitor cryptocurrency exchange Kraken, Payward, acquired Bitnomial last year for $550 million, obtaining the licenses for a similar exchange and clearinghouse that have now been internally established by Coinbase.

Payward has already started using these licenses. The company plans to launch perpetual futures to American customers through Hyperliquid, with the market created and cleared by Bitnomial. The transactions will be conducted on a public blockchain. With its own clearing house, Coinbase also meets the licensing requirements to attempt similar schemes, although the company has not announced any such plans yet.

This approval came during a busy month for Coinbase. Just on Monday, the company deepened its collaboration with Citibank, allowing institutional clients of that bank to accept stablecoin payments when settling accounts. Last week, the company collaborated with Morpho to launch a fixed-rate USDC loan secured by Bitcoin; in August, the company also launched tokenized stocks to users outside of the United States in Base.