Coinbase (COIN) can now offer cryptocurrency futures trading on its U.S.-based exchange, the company said.

Crypto Futures Seen as an Important Milestone for Coinbase

Coinbase customers will soon be able to access futures through the exchange's Coinbase Financial Markets offering. After filing an application to become a Futures Commission Merchant with the National Futures Association (NFA) in September 2021, Coinbase has now gained approval to bring federally regulated crypto futures trading to its customers.

The nod makes Coinbase the first purely cryptocurrency trading platform to be able to offer such products.

Bitcoin futures are already available via the Chicago Mercantile Exchange (CME) and CBOE Digital, an arm of the Chicago Board Options Exchange (CBOE), also received the nod to launch leveraged bitcoin and ether futures in June.

This is not CBOE's first brush with crypto futures. The exchange listed bitcoin futures in 2017 that saw record trading volumes before the CBOE discontinued the product just about two years later because of a lack of demand.

According to an announcement made by Coinbase, around 75% of global crypto trading volume is made up of futures, which is why approval from the NFA is seen as an important milestone. Coinbase referred to the approval as a "watershed moment."

Coinbase shares were up roughly 1% in early trading Wednesday, in anticipation that the new regulatory approval could open additional revenue streams for the crypto exchange. However, they dropped around midday and were down roughly 1%.

Coinbase's institutional clients have already been able to trade crypto futures on the platform; however, this latest regulatory approval will open up futures to the rest of Coinbase's eligible U.S. customers.

Notably, Coinbase's approval for futures trading comes amidst the exchange's legal battle with the SEC. A number of different crypto companies, including Binance and Coinbase, have come under fire from the SEC this year for selling unregistered securities, and Coinbase CEO Brian Armstrong has publicly shared his belief that the regulatory climate around crypto in the U.S. could push the industry offshore.