Hedge Funds Increasingly Turn to Coinbase Prime for Trading

Coinbase Expands Institutional Services with Key Acquisition

Coinbase has aggressively expanded its institutional services, integrating features like custodial staking and prime brokerage tools. Acquiring Deribit, a leader in crypto derivatives, has further strengthened its platform for institutional investors.

Led by CEO Brian Armstrong, the Coinbase Institutional team has focused on enhancing trading, custody, and derivatives services. The acquisition of Deribit for $2.9 billion highlights Coinbase’s commitment to facilitating institutional growth.

Hedge Funds Drive 140% Surge in Institutional Trading

The institutional trading volume surged 140% in 2024, signaling hedge funds’ significant interest. This adoption reflects Coinbase’s efforts to provide Wall Street-grade services, attracting new inflows and expanding market participation.

Regulatory clarity in 2025, following resolved SEC lawsuits, has facilitated this institutional surge, ensuring legal stability. Historical trends suggest such shifts attract more traditional finance players, increasing market liquidity and interest. “As of March 31, 2025, the fair market value of our crypto assets held for investment and our crypto assets held as collateral were $1.3 billion.” (Coinbase Q1’25 Shareholder Letter)

ETFs and Regulatory Shifts Boost Institutional Adoption

Spot Bitcoin and Ethereum ETF approvals in 2024 set a precedent for institutional inflows. Enhanced trading tools and staking services parallel past pivotal shifts, further cementing crypto’s mainstream financial acceptance.

Experts at Kanalcoin suggest that these developments, supported by historical trends, could result in a new wave of institutional adoption. Improved regulatory environments and trading infrastructures are key in facilitating this rise.

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