CFTC’s New Rules Cause Coinbase to Stop Offering Crypto Margin Trading
Cryptocurrency exchange Coinbase is disabling its margin trading product in order to comply with the new rules set by the Commodity Futures Trading Commission (CFTC). CFTC’s Rules Affecting Margin Trading Offerings Coinbase’s chief legal officer, Paul Grewal, explained in a blog post on Tuesday: In response to new guidance from the Commodity Futures Trading Commission, we are disabling our margin trading product. Starting on Wednesday, Nov. 25 at 2 p.m. PT, customers currently using Coinbase’s margin trading will not be able to place new margin trades and all open limit....
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The exchange said the move was in response to “new guidance from the Commodity Futures Trading Commission.” U.S. crypto exchange Coinbase Pro announced today that customers would not be able to use margin trading on the platform beginning on Wednesday.According to the Coinbase blog, Chief Legal Officer Paul Grewal said that no new margin trades would be allowed starting on Nov. 25 at 2:00 PST. The exchange stated that it would take the product offline in December “once all existing margin positions have expired.”“We believe clear, common sense regulations for margin lending products are....
“Margined, leveraged or financed digital asset trading offered to retail U.S. customers must occur on properly registered and regulated exchanges in accordance with all applicable laws and regulations,” said Vincent McGonagle, the CFTC’s acting director of enforcement. The United States Commodity Futures Trading Commission, or CFTC, is ordering crypto exchange Kraken to pay more than a million dollars in civil monetary penalties related to allegations the exchange is violating the Commodity Exchange Act.In a Sept. 28 statement, the CFTC said U.S.-based crypto exchange Kraken — operating....
As Bitcoin exchanges in China halt margin trading, zero-fee trading may also be on the chopping block as the industry awaits regulation. China Halts Margin Trading Following the inspections conducted by the People’s Bank of China, the country’s ‘Big Three’ Bitcoin exchanges BTCC, OKcoin and Huobi have stopped margin trading services. Although no official statement from the PBoC has been issued regarding the legality of the margin loan services, media reports state that the platforms’ margin trading “violated rules” and resulted in abnormal price volatility. BTCC CEO Bobby Lee reacted to....
CEX.IO Bitcoin exchange has launched BTC/USD and ETH/BTC margin trading with special risk-preventing system. The BTC/USD and ETH/BTC margin trading with 1:2 and 1:3 leverages comes with a range of competitive advantages making it easy and attractive even for beginners. Thus, no extra margin account is required to be opened to trade with leverage, and borrowing funds is done automatically together with position placement. The risk-preventing system ensures that the position will be closed at price and not worse than the stop loss price. Therefore, margin trading cannot move user’s balance....
Coinbase plans to suspend all margin trading contracts effective tomorrow, and will end the service entirely by next month.