Coinbase is having important negotiations to acquire Deribit, the top cryptocurrency derivatives exchange for Bitcoin (BTC) and Ether (ETH) options trading. This deal will consolidate Coinbase's current derivatives platform, which primarily focuses on futures contracts. Both companies have notified regulators in Dubai about these negotiations. Deribit currently has an operating license in Dubai, which would need to be transferred to Coinbase if the transaction is successful. It is estimated that Deribit's value could reach between $4 billion and $5 billion.
Deribit is known for its options products, futures contracts, and real-time cryptocurrency trading, with last year's trading volume reaching approximately $1.2 trillion. On March 20, Kraken - another cryptocurrency exchange, announced plans to acquire the NinjaTrader derivatives trading platform for around $1.5 billion. Cryptocurrency derivatives are becoming extremely popular in the United States, with futures contracts and options increasingly preferred.
Futures contracts allow investors to buy and sell assets at a future point in time, typically with leverage. Options allow investors to buy or sell the underlying asset at a specific price. Both forms are popular among individual and institutional investors for risk hedging and speculation. In December, Coinbase reported that derivatives trading volume increased by approximately 10,950% in 2024.
Coinbase has also listed derivatives products linked to 92 different assets on its international platform and fewer in the United States. In January, Robinhood introduced cryptocurrency futures as an effort to compete with Coinbase. In February, CME Group reported an average daily cryptocurrency derivatives trading volume of around $10 billion in the fourth quarter of 2024, an increase of over 300% compared to the previous year.
Coinbase pioneered the introduction of Solana (SOL) futures contracts under the management of the Commodity Futures Trading Commission in February, and CME also launched its own SOL futures contract the following month.
