Crypto exchange Coinbase announced on its blog that it has obtained a Class F license from the Bermuda Monetary Authority (BMA) amid its ongoing international expansion efforts. Although the company remains tight-lipped about potential services offered in Bermuda, it is reportedly preparing to open a derivatives exchange on the island.
Offshore Platform Launch and Regulatory Partnerships
Last month, the exchange explored the possibility of launching an offshore platform, discussing the idea with institutional clients such as market makers and investment firms. As U.S. regulators continue to send mixed signals to crypto businesses, Coinbase seeks to expand its global presence.
A company spokesperson told CoinDesk, “While we are excited to partner with the BMA, and to have successfully attained the Class F License in this high-bar regulatory jurisdiction, nothing to announce today regarding our future plans to offer services through this license.”
Canadian Market Investment and Expansion in the Middle East and Europe
As part of Coinbase’s “8-week international expansion drive,” the company noted in its blog post that it is doubling down on investments in the Canadian market, hiring Lucas Matheson as country director and signing a Pre-Registration Undertaking (PRU) in preparation for becoming a registered exchange in Canada.
Moreover, Coinbase mentioned it is in talks with the Financial Services Regulatory Authority (FRSA) of the Abu Dhabi Global Market (ADGM), a crypto-friendly free economic zone in the United Arab Emirates, about the possibility of opening a regulated exchange there.
CEO Brian Armstrong’s recent meetings with UK officials, including Economic Secretary and City Minister Andrew Griffith, the Bank of England, and the Financial Conduct Authority (FCA), were described as “highly encouraging.” Armstrong also tweeted about the UK’s progress in crypto regulation and the need for further education and collaboration.
Armstrong’s Stance on U.S. Regulators
Since its founding in 2012, Coinbase has become the second-largest exchange by trading volume, largely due to its willingness to comply with domestic regulators. However, Armstrong is often critical of U.S. regulators, particularly the Securities and Exchange Commission (SEC), which has been pursuing a regulation-by-enforcement strategy for cryptocurrencies and crypto businesses.
Armstrong’s criticisms of the SEC are shared by industry peers and even some Commission members. Last Friday, Commissioner Hester Pierce expressed a strongly-worded dissent against the SEC’s plan to change the definition of “exchange” to bring crypto exchanges under its jurisdiction.
