Coinbase is preparing to introduce a new feature that will enable users to trade new crypto tokens before they are officially launched. The Coinbase International Exchange and Coinbase Advanced will allow traders in eligible jurisdictions outside of the US, the UK, and Canada to purchase perpetual futures contracts for assets that have not yet been listed on spot exchanges.
When the underlying asset for a pre-launch perpetual futures contract is officially listed on an exchange, the contract will transition to a standard perpetual contract. Although Coinbase states that the upcoming feature will allow traders to “participate in price discovery,” the exchange also cautions that pre-launch markets carry higher risks.
“Given the high-risk nature of pre-launch markets, these markets are more susceptible to lower liquidity, higher volatility, and increased liquidation risk. Please note that positions for pre-launch markets will not be assigned to participants of our Liquidity Support Program (LSP). As a result, these markets will be at a higher risk of Auto-Deleveraging compared to standard perpetual futures.”
Coinbase Advanced, the exchange’s advanced trading platform, will offer pre-launch markets for retail traders, while the Coinbase International Exchange will provide the instruments for eligible institutional users. According to Coinbase, the pre-launch perpetual futures contracts will have funding rates that use the same formula as standard perpetual futures.
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