Coinbase, the largest cryptocurrency exchange in the United States, has acquired a Class F license from the Bermuda Monetary Authority (BMA) under the Digital Asset Business Act.
This new license allows Coinbase to launch an offshore derivatives exchange platform that will permit the trading of perpetual swaps tied to cryptocurrencies.
The news has raised speculation on how the crypto exchange will handle the current regulatory scrutiny in the US, especially with its announcement of possible relocation in the region.
Coinbase’s Class F license enables the company to engage in various activities, including the sales and issuance of tokens.
Additionally, it grants permission for Coinbase to function as a digital asset exchange, as well as a provider of digital asset derivatives.
The company chose Bermuda as one of its international hubs because of its extensive experience in its financial regulations, which are known for their high level of rigor, transparency, compliance, and cooperation.
The company’s announcement also included an update on its “global scale to go broad and go deep” strategy. Coinbase plans to establish regulated entities and local operations to facilitate expansion on a global scale.
The company has already made progress in countries such as Brazil, Canada, Singapore, Europe, and the United Arab Emirates.
During an industry conference organized by Innovate Finance, Coinbase CEO Brian Armstrong called for clearer regulations on cryptocurrency in both the US and the United Kingdom.
Armstrong argues that without such laws, companies may be forced to develop in “offshore havens,” where they may be subject to less oversight and regulation.
He cited the failure of the Bahamas-based FTX exchange last year as evidence of the need for clearer regulations. Armstrong believes that offshore locations with less regulatory oversight pose a risk to the legitimacy of the cryptocurrency industry.