Boris Ilyevsky, Head of Coinbase Derivatives Exchange (at Coinbase (NASDAQ:COIN)) notes that the platform will be launching a Nano Ether futures contract (ET) on August 29, 2022 as they continue “to build an accessible futures market for the retail trader.”
Sized at 1/10th of an ether, the contract “unlocks another opportunity to trade the price of a popular digital asset with less upfront capital than traditional futures products.” This will “enable all types of traders to securely access regulated U.S. crypto derivatives markets to express their views or hedge their underlying crypto assets.”
This launch “follows the introduction of [their] Nano Bitcoin futures contract, which was made available on June 27th to the participants of six retail brokers through our CFTC-regulated Designated Contract Market (DCM).” In the last 30 days, that contract has “traded an average of 77,000 contracts per day.”
While still in its early stages, Coinbase believes that product innovation and an accessible entry point for the retail market “have contributed to its success.” At 1/100th of Bitcoin, their Nano Bitcoin futures contract “requires less upfront capital, allowing participants to easily go long or short the price of Bitcoin and manage risk in volatile markets.”
Similar to the Bitcoin contract, the Nano Ether futures “will be made available for trading via the following retail brokers EdgeClear, Ironbeam, NinjaTrader, Optimus Futures, Stage 5, and Tradovate, and clearing firms ABN AMRO, ADMIS, Advantage Futures, Dorman Trading, ED&F Man, Ironbeam and Wedbush.”
Coinbase Financial Markets is “awaiting approval for its license to operate a futures commission merchant (FCM) to offer futures directly to our clients as we take another step in creating an accessible and regulated U.S. crypto derivatives market.”
For additional information on their products, check here.
As covered, GraniteShares announced the listing of multiple single share ETFs on the Nasdaq, including one for Coinbase (NASDAQ:COIN). GraniteShares first launched leveraged ETFs on single stocks in the UK in 2019.
While ETFs started as a less expensive path for a diversified portfolio of assets, a single share ETF typically provides leveraged exposure, either short or long, to a security that can drive returns more dramatically as well as losses. Some investors are interested in the ability to trade in the short term based on event-driven expectations. The Securities and Exchange Commission (SEC) has issued a statement of caution on these single-share ETFs.
Last month the SEC stated:
“[single share ETFs] they are not right for every investor. Levered and/or inverse single-stock ETFs pose risks that are unique and complex. We encourage all investors to consider these risks carefully before deciding to invest in levered and/or inverse single-stock ETFs.”