Coinbase Has Started Margin Trading Again
Coinbase one of the leading cryptocurrency exchange and one of the best exchanges to buy Bitcoin in the US just announced to launch its margin trading again. Coinbase announced that some selected users can get early access to the margin trading starting from Wednesday.
Coinbase has halted all margin trading back in 2017 after the flash crash of Bitcoin price. The margin trading suspensions hit very hard on the second-largest cryptocurrency Ethereum whose price goes down to 10 cents from $300 in just a few seconds.
Coinbase will start offering a maximum of 3x leverage in starting, this is very low as some players in the cryptocurrency market offers up to 125x leverage. The margin trading services initially open for institutional clients in 45 states of the U.S and in 23 states for the Coinbase Pro users. Coinbase will expand its services in the upcoming years.
Coinbase stopped its margin trading because of the flash crash due to some margin calculating errors. The Commodities Futures Trading Commission (CFTC) has also sent Coinbase an inquiry about the margin trading errors.
Coinbase was in the few exchanges list that does not offer margin trading. Margin trading will help the exchange to grow more users and volumes. Coinbase has lost a 3% market share since June and the trading volume is around 20% down from 95.3 billion in 2018 to $76.9 in 2019.
