Coinbase is teaming up with Nodal Clear to let people use USDC, a stablecoin, as collateral for futures trading. This means traders can use USDC as a kind of digital cash to back their trades.
USDC Becomes Regulated Collateral
Starting next year, Coinbase will allow USDC as collateral. This is a big deal because it’s a regulated process overseen by the Commodity Futures Trading Commission (CFTC). Coinbase says using USDC will make things faster and safer. They’re emphasizing the speed and security of using USDC, highlighting near-instant transfers and secure custody through Coinbase Custody Trust (which is regulated by the New York Department of Financial Services).
Positive Reactions and Market Impact
Both Nodal Clear and Coinbase are thrilled about this partnership. They see it as a way to modernize trading and meet market demand. The news has been great for both Circle (the company behind USDC) and Coinbase. Circle’s stock jumped 33% and Coinbase’s rose over 16%, likely fueled by the Senate’s passage of the GENIUS Act and the growing acceptance of stablecoins.
The Bigger Picture: Stablecoins and the Future of Finance
The move reflects a broader trend towards using stablecoins like USDC in financial markets. Regulators are increasingly supportive, seeing them as a way to make the financial system more efficient and modern. This is boosting Coinbase’s bottom line, with stablecoin revenue up 50% year-over-year. Using USDC in futures trading is expected to be a game-changer.