CySEC License Unlocks CFD Opportunities for Coinbase in Europe
Coinbase, the largest cryptocurrency exchange in the United States, acquired the Cyprus subsidiary of BUX and renamed it Coinbase Financial Services Europe.
The move provides Coinbase with a coveted Cyprus Investment Company (CIF) license, allowing the cryptocurrency exchange giant to offer contracts for difference (CFDs) across the European Economic Area (EEA).
Coinbase expands horizons with CySEC license
According to Finance Magnates, the acquisition marks a key moment in Coinbase’s European strategy. With the CIF license issued by the Cyprus Securities and Exchange Commission (CySEC), Coinbase has received regulatory permission to expand its financial product offerings, particularly to professional and institutional clients.
The license also enables Coinbase to deliver its services to other European Economic Area countries, strengthening its foothold in the region.
Yorick Naeff, CEO of BUX, said: “We are pleased to sell our MiFID licensed entity, BUX Europe Limited (BEU), to Coinbase, a globally recognized leader in the cryptocurrency industry.” explain.
Although Coinbase has not officially confirmed its intention to enter CFDs, the infrastructure acquired from BUX allows it to compete with established companies CFD provider. Elsewhere, the acquisition of BUX’s Cyprus unit follows BUX’s wider divestment strategy.
Headquartered in the Netherlands, BUX has shifted its focus to stocks and ETFs (exchange-traded funds), leaving its Cyprus clients to AvaTrade. Naeff stressed that the sale was in line with BUX Holding’s strategy to focus on its core products after ABN AMRO acquired most of its business.
Coinbase targets professional customers
Meanwhile, Coinbase’s focus under the new license appears to be on institutional and professional clients rather than retail investors. This is consistent with its broader strategy of catering to large-scale market players. As part of its institutional offering, Coinbase already offers Hosting services 8 of 11 Bitcoin ETF issuers in the United States.
It also provides trade execution and market monitoring services and manages about 90% of the $37 billion in Bitcoin ETF assets. However, some experts have expressed concerns about Coinbase’s dominance in this space.
“Almost all cryptocurrency ETF issuers have the same custodian for all BTC and ETH, which is not a good sign. This makes Coinbase a potential single point of failure, which is scary.” Fox Business News reporter Eleanor Terrett explain recent.
These questions about market concentration and potential risks highlight the need for a diversified approach as the cryptocurrency market matures. Nonetheless, the acquisition of BUX’s Cyprus unit marks Coinbase’s planned expansion into new financial areas, backed by strong institutional backing.
With the CIF license in hand, Coinbase is poised to enhance its European offerings while continuing to dominate the institutional cryptocurrency space. The acquisition also comes after Coinbase ended a strong 2024. Excellent year-end financial results. According to recent reports, Coinbase is poised for growth in 2025 due to increasing institutional interest in crypto products.
Nonetheless, Coinbase is not the only company exploring the potential of CFDs. Cryptonet Recently acquired Australian CFD broker Fintek Securities, while Bybit holds a license to provide foreign exchange in Mauritius, and CFD product. The surge in interest reflects growing demand from institutional clients for diverse trading options.
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