Coinfeeds Daily → Coinbase Introduces Pre-Launch Markets for Digital Assets

Coinbase Introduces Pre-Launch Markets for Digital Assets

Published: Jun 18, 2024 | Last Updated: Jun 18, 2024
Howard Kane

New feature allows traders to bet on unlisted tokens with up to 2x leverage, available outside the US, UK, and Canada.

Coinbase has recently introduced a new feature called "pre-launch markets," which allows traders to place bets on digital assets before they are officially launched. This initiative is available through Coinbase International Exchange for institutional users and Coinbase Advanced for eligible retail traders outside the US, Canada, and the UK.

What Are Pre-Launch Markets?

Pre-launch markets enable trading in perpetual futures contracts of unlisted tokens. This means that traders can speculate on the future value of a digital asset before it becomes available to the general public. The feature aims to facilitate price discovery for upcoming projects within a secure platform, offering up to 2 times leverage on unlaunched tokens.

High-Risk, High-Reward

Trading unreleased tokens presents both high risks and potential rewards. This speculative approach allows traders to engage in price discovery of upcoming tokens through perpetual futures contracts. Once the tokens go live, these contracts transition into standard futures.

However, there are significant risks involved. These include increased volatility, the risk of market manipulation, and the possibility of delisting if the token never releases. To manage these risks, Coinbase has implemented measures such as strict leverage limits and isolated margin modes.

Regulatory Constraints

It's important to note that these pre-launch markets are not available in the US, UK, and Canada due to regulatory constraints. This limitation means that traders from these regions will not be able to participate in this high-risk, high-reward trading opportunity.

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