Tag: Coinbase Pro

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Coinbase disables margin trading following guidance from Commodity Futures Trading Commission

Just a few months after launching margin trading on Coinbase Pro, the company is disabling the feature. Margin trading lets you trade on leverage. But it works both ways — margin trading lets you multiply your gains and your losses.

Starting on November 25, 2pm PT, users won’t be able to place new margin trades. Existing margin positions will expire over the coming days and weeks. Once those positions expire, margin trading will be disabled for good.

The company is following guidance from the Commodity Futures Trading Commission. Interestingly, the CFTC was well aware of the company’s plans to launch margin trading.

Coinbase says it has regular conversations with the CFTC and gives them a heads up about upcoming products and services. The same thing happened with margin trading.

Margin trading hasn’t been available on Coinbase’s main website. It has been limited to some Coinbase Pro users with a cap on the number of users who can access the feature.

And yet, Coinbase wouldn’t have launched margin trading if the company could have anticipated a change of course on the regulatory front. More than 100,000 users signed up to the wait list, indicating some interest from Coinbase’s user base.

But the company has no choice but to end margin trading as it tries to be as compliant as possible with current regulation. Let’s see if other exchanges that operate in the U.S. will follow suit.

Coinbase launches margin trading for some users

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Coinbase launches margin trading for some users

Cryptocurrency exchange Coinbase is launching margin trading today. Margin trading lets you trade on leverage. But it works both ways — margin trading lets you multiply your gains and your losses.

Margin trading is going to be available on Coinbase Pro, the company’s exchange interface for educated investors. Both retail and institutional investors will be able to submit margin trading orders with up to 3x leverage. It’ll work with any pair of assets with USD as the base currency.

For now, the feature is limited to 23 U.S. states if you’re a retail investor. Institutional investors in 45 states and 9 international countries can access margin trading though.

There are many potential use cases for margin trading. For instance, you can allocate a tiny portion of your portfolio to a margin trading order in order to hedge across multiple positions. Coinbase believes it has enough liquidity to help investors set up sophisticated margin trading orders.

If you’re a retail customer living in one of the 23 states where margin trading is available, you might not be able to use it. The company wants to restrict margin trading to the most advanced traders.

Coinbase is going to track your past activity on Coinbase Pro and look at trades, balances, deposits and withdrawals. If you’re an active trader, you’ll be able to access margin trading.

Here’s the list of 23 U.S. states with margin trading for retail investors: FL, TX, IL, NJ, VA, GA, AR, AK, OR, CT, NH, MA, NE, NC, OK, CO, KS, ME, SC, UT, WI, WY and WV.

Disclosure: I own small amounts of various cryptocurrencies.

Posted on

Coinbase launches margin trading for some users

Cryptocurrency exchange Coinbase is launching margin trading today. Margin trading lets you trade on leverage. But it works both ways — margin trading lets you multiply your gains and your losses.

Margin trading is going to be available on Coinbase Pro, the company’s exchange interface for educated investors. Both retail and institutional investors will be able to submit margin trading orders with up to 3x leverage. It’ll work with any pair of assets with USD as the base currency.

For now, the feature is limited to 23 U.S. states if you’re a retail investor. Institutional investors in 45 states and 9 international countries can access margin trading though.

There are many potential use cases for margin trading. For instance, you can allocate a tiny portion of your portfolio to a margin trading order in order to hedge across multiple positions. Coinbase believes it has enough liquidity to help investors set up sophisticated margin trading orders.

If you’re a retail customer living in one of the 23 states where margin trading is available, you might not be able to use it. The company wants to restrict margin trading to the most advanced traders.

Coinbase is going to track your past activity on Coinbase Pro and look at trades, balances, deposits and withdrawals. If you’re an active trader, you’ll be able to access margin trading.

Here’s the list of 23 U.S. states with margin trading for retail investors: FL, TX, IL, NJ, VA, GA, AR, AK, OR, CT, NH, MA, NE, NC, OK, CO, KS, ME, SC, UT, WI, WY and WV.

Disclosure: I own small amounts of various cryptocurrencies.

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Coinbase is launching Coinbase Pro mobile app

Cryptocurrency exchange company Coinbase is launching a mobile app for its advanced users today. You can now download the Coinbase Pro mobile app on iOS — the Android version is coming soon.

Coinbase Pro is the company’s exchange that lets you set up advanced order types, such as limit orders. Those are fairly standard features for a cryptocurrency exchange. But Coinbase set up a separate “pro” platform so that the main Coinbase.com exchange remains as simple and straightforward as possible.

And now, you can also use Coinbase Pro on your phone. I’ve been playing around with the app, and it features everything you’d expect. On the first tab, you can see a list of trading pairs.

Coinbase Pro

If you tap on a pair, you can see real-time candles, the order book, your active orders as well as trade history for this specific pair. You can also set up an order to buy and sell cryptocurrencies from each trading pair page.

On the second tab, you can see your portfolio of crypto assets and its value in fiat currencies. You can deposit or withdraw cryptocurrencies from the mobile app. Unfortunately, if you want to deposit or withdraw fiat currencies (USD, EUR, GBP, etc.), the app tells you to head over to the website.

Finally, you can see your past and active orders, check your fees and limits.

Coinbase increased some of its trading fees on Coinbase Pro for low-volume accounts just last week. It is now more expensive to trade on Coinbase Pro if you trade less than the equivalent of $50,000 over 30 days. And if you trade less than $10,000 over 30 days, it now costs 0.50% in maker and taker fees.

Kraken charges 0.26% in taker fees if you trade less $50,000 in the past 30 days. Binance charges 0.1% in trading fees. With those new trading fees, it feels like Coinbase is indeed targeting pro users with Coinbase Pro.

Disclosure: I own small amounts of various cryptocurrencies.