Coinbase Reportedly Looking At Launching Overseas Exchange

By Kevin • March 18, 2023 10:27 am • Comments

Coinbase is one of the largest cryptocurrency exchanges that is currently operating within the United States that has managed to still comply with regulations.

However, it seems that Coinbase is in discussions with institutional investors about opening up a new overseas crypto exchange in order to serve customers globally.

This would be a huge change for the company as the overseas operations could potentially be free of stringent regulations that exist domestically.

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Additionally, it would attract a lot of other capital from global clients without having to face any suspicion from the SEC on whether or not the assets traded on the exchange are considered securities or not.

So far, it is still unclear where this overseas exchange might be or what region in the world it would be based out of.

BitcoinMagazine reports:

According to sources cited by Bloomberg, “talks with market makers and investment firms touched on the possibility of establishing an alternative venue — away from the main Coinbase marketplace — for global clients.”

The sources continued to explain that the company has not yet decided the location the platform might base itself out of.

Recent regulatory actions have led to a turnaround in sentiment in regards to the advancement of the bitcoin and cryptocurrency industry in the United States.

Major exchanges have faced regulatory headaches, with Kraken settling for $30 million in fines in an SEC lawsuit, and Coinbase owing $100 million to the state of New York after regulators alleged Coinbase “violated anti-money-laundering laws by allowing users to open accounts without conducting sufficient background checks.”

With many of the crypto friendly banks within the United States collapsing in just the past month, this move from Coinbase does make a lot of sense.

Essentially, it would be wise for the company to diversify its assets in different regions so that the company is not affected to much if the climate for crypto platforms in one area becomes unfavorable.

A lot of this crypto firms also rely on domestic banks in order to hold capital and the past events have shown that it is unwise to have too much capital in just one area.

The company has not yet many any official announcements regarding the overseas exchange or when it might launch in the future.

However, it is clear that the probability of Coinbase doing this is very high as multiple sources have shared the ongoing discussions with institutional clients who are the ones that provide the majority of the capital to Coinbase.

Bitcoinist concludes:

Although establishing a platform overseas could provide Coinbase with greater regulatory flexibility, the exchange will still need to navigate the regulatory landscape of the new jurisdiction, which may pose its challenges and requirements. So what are the options for establishing a unique venue for Coinbase?

Europe appears to be the most promising option for crypto firms in the wake of the recent banking crisis in the US, which has seen the closure of operations by Silvergate, Silicon Valley Bank, and Signature Bank, as reported by Bitcoinist.

In addition to Coinbase, several other crypto firms are reportedly exploring opening Swiss bank accounts amidst the ongoing banking crisis.

Switzerland’s banking and financial services industry has made it a hub for many cryptocurrency startups, and the country is widely recognized as a leader in the crypto industry. This makes Switzerland a potentially attractive location for Coinbase and other crypto firms seeking to establish a foothold in the region.

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