Coinbase to launch DOGE futures may be aimed at forcing SEC to take action

Cryptocurrency exchange Coinbase believes that Dogecoin’s “enduring popularity” shows that it has transcended its meme origins to become a staple in the cryptocurrency industry, and the exchange now plans to launch a futures trading product for the cryptocurrency.

In three separate letters to the U.S. Commodity Futures Trading Commission (CFTC) on March 7, Coinbase Derivatives announced plans to launch cash-settled futures contracts for Dogecoin, Litecoin, and Bitcoin Cash as early as April 1.

Notably, the letter states that Coinbase Derviatives can list futures contracts on its platform before receiving formal approval from the CFTC.

Coinbase explained that it will use a “self-certification” approach to launching futures contracts, as long as they follow regulatory guidelines set by the agency.

“Coinbase Derivatives [...] hereby submits for self-certification the initial listing of Dogecoin futures contracts that will be traded on the Exchange on or after April 1, 2024,” the letter regarding the Dogecoin futures product reads.

Coinbase cites “self-certification” rules to list Dogecoin before April 1. Source: CFTC

Coinbase has defended its announcement to list Dogecoin, claiming that the meme coin has transcended its origins as a mere joke and has become a fundamental element of the crypto industry.

“Dogecoin’s enduring popularity and active community support suggest that it has transcended its origins as a meme to become a staple in the cryptocurrency world.”

DOGE’s price is currently up 17% on the day, trading at $0.15 at press time, according to CoinMarketCap.

While several market commentators on social media seemed confused by the move, analysts suggested that listing futures contracts could be a calculated move by Coinbase to force the SEC to take action.

Bloomberg ETF analyst James Seyffart suggested in a March 20 X post that the filings could be a strategic ploy to force the SEC to classify any crypto assets based on the same proof-of-work consensus mechanism as Bitcoin from being declared “securities.”

“Wonder if the SEC would object to them being classified as ‘commodity futures’ vs ‘security futures,’” Seyffart wrote. “These [are all based on] Bitcoin, so it would be hard to make the argument that ‘these are securities’ after a spot Bitcoin ETF is approved.”

Source: James Seyffart

In 2022, Coinbase acquired the CFTC-regulated FairX derivatives exchange to launch crypto derivatives trading for its U.S. customers.

“We want to make the derivatives markets more accessible to our millions of retail customers,” Coinbase said at the time.