Dogecoin might have started as merely a joke, but this April Fool’s Day, it’s receiving some serious attention. Crypto exchange Coinbase, known for its rigorous listing standards and regulatory compliance, is set to launch futures trading for the leading doggy-themed meme coin alongside Litecoin and Bitcoin Cash.

Coinbase believes Dogecoin’s “enduring popularity” suggests it has evolved from a whimsical meme to a foundational element in the current investing climate.

Dogecoin Sheds Meme Status With Upcoming Coinbase Futures Trading

In three separate letters to the Commodities Futures Trading Commission (CFTC) on March 7, Coinbase disclosed its intention to launch monthly cash-settled futures contracts for Dogecoin (DOGE), Litecoin (LTC), and Bitcoin Cash (BCH).

Coinbase said in the letters that it would invoke the self-certification route under CFTC Regulation 40.2 (a) to list these futures contracts. This method allows exchanges to launch new offerings before receiving CFTC approval as long as they adhere to the regulatory guidelines stipulated by the commission.

Coinbase defended its listing of DOGE futures by arguing that the memecoin had transcended its joke status and had grown to become a notable force in the crypto landscape.

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

The price of DOGE rose as much as 14.2% over the last 24 hours to trade hands at $0.1517 at press time.

When DOGE ETF?

Crypto observers have suggested that Coinbase’s move is calculated given that Dogecoin, Litecoin, and Bitcoin Cash are all based on Bitcoin’s proof-of-work mechanism, and the SEC recognizes BTC as a commodity. As such, this potentially dissuades the regulator from classifying such crypto assets as securities.

Bloomberg ETF analyst James Seyffart remarked on X, “This is interesting… wonder if the SEC objects to these being classified ‘commodities futures’ versus ‘securities futures’. Given their origins from Bitcoin, arguing these as securities would be challenging, especially after spot #Bitcoin ETF approvals. Coinbase’s selection might be strategic.”

Others deemed Coinbase’s move to launch Dogecoin futures as a likely precursor for the launch of U.S.-based spot DOGE exchange-traded funds (ETF) in the future.

The greenlighting of spot Bitcoin (BTC) ETFs in January and the subsequent success of these novel products have given optimism to many about the possibility of ETFs based on other cryptocurrencies such as ether, Dogecoin, Ripple’s XRP, and others securing approval. But whether a similar trend will follow for these altcoins remains to be seen.

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Filed under: Bitcoin - @ March 21, 2024 12:21 pm