Coinbase Expands Its Derivatives Offerings with Silver (SLR) and Stellar (XLM) Futures Contracts

Coinbase Derivatives' primary goal in launching new crypto futures contracts is to create markets that offer retail traders diversification, price discovery, risk management, and margin.

Coinbase Derivatives, a Commodity Futures Trading Commission (CFTC) contract market, has announced the launch of new crypto futures contracts for Silver (SLR) and Stellar (XLM) on its official X account, slated for November 11, 2024. These contracts will join the existing CFTC-regulated products, including LTC, DOGE, SHIB, AVAX, DOT, LINK, Gold, BTC, ETH, BCH, and Oil.

Coinbase Derivatives enables users to trade and hedge the price of digital assets. Derivatives are contracts that draw their value from an underlying asset or commodity, allowing exposure to an asset without purchasing it directly.

Coinbase’s goal is to create markets that offer retail traders diversification, price discovery, risk management, and margin. With the addition of Silver and Stellar futures, Coinbase is expanding its commodity and cryptocurrency derivatives trading options.

Coinbase’s statement highlights the aim to combine traditional commodities like Silver with cryptocurrencies like Stellar on a single platform, catering to a broader range of asset classes. This approach is intended to diversify opportunities for investors, enabling them to manage risk across different asset types.

The futures contracts offered by Coinbase Derivatives support effective price discovery, helping to establish fair market prices and enabling traders to respond confidently to shifts in the market. The Stellar and Silver contracts are designed to increase market accessibility and cater to retail-focused trading with smaller contract sizes.

Each Silver contract represents 50 troy ounces, while each Stellar Lumens contract is 5,000 tokens. By introducing these retail-sized contracts, Coinbase aims to encourage a more extensive range of participation among retail traders who may be looking for affordable ways to enter futures markets.

notably, Silver is a new tradable asset for Coinbase, marking a push into commodity markets. Silver futures give users a way to hedge against inflation or other economic changes, as silver has remained a traditionally stable asset during times of market volatility.

On the other hand, Stellar is a decentralized, open-source network that enables low-cost cross-border transactions between any pair of cryptocurrencies. The Stellar network also features an integrated decentralized exchange (DEX), allowing users to trade assets on the network.

Besides its capabilities for low-cost transactions, Stellar utilizes a unique system, the Stellar Consensus Protocol (SCP), to process transactions faster and more reliably than many traditional networks.

In related news, CNF reported on October 23 that Robinhood announced its support for Stellar on its official X account, enabling EU users to deposit and withdraw XLM on the Robinhood app.

This move is significant for both Robinhood and XLM, as the flexibility in handling the coin can benefit both ecosystems. Notably, despite a 1.94% decrease in XLM’s price to $0.0914 over the last 24 hours, trading volume rose by 10.74% to $54.29 million, indicating ongoing interest from investors in XLM’s diverse use cases.