Coinbase expands crypto prime brokerage offering for institutional market

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Coinbase expands institutional prime brokerage

Highlights

Coinbase added cross-margining between spot and derivatives positions in March, completing its full-service crypto prime brokerage offering for institutions.
Coinbase Prime now bundles trading, custody, and financing services, with over $350 billion in assets under custody and $236 billion in quarterly trading volume.
D’Agostino states Wall Street banks are likely to partner with crypto infrastructure providers rather than compete directly, as crypto remains a small portion of global markets.

Cross-margining completes institutional stack

As reported by CoinDesk, Coinbase Institutional strategy head John D’Agostino says the company now meets the traditional definition of a full-service prime broker in crypto after adding cross-margining between spot and derivatives positions in March. He says the Wall Street checklist includes trading, custody, financing, derivatives and cross-margining, with staking adding an extra layer for digital assets.

D’Agostino says crypto funds have typically assembled those functions through multiple providers, using one firm for custody, another for derivatives and others for financing. He says Coinbase now provides those services natively through one platform rather than through a patched-together structure.

Coinbase Prime bundles trading, custody and financing for hedge funds and asset managers, while the company says the platform holds more than $350 billion in assets under custody and serves as custodian for more than 80% of U.S. bitcoin and ether ETF assets. Coinbase’s institutional platform processes about $236 billion in quarterly trading volume, supports more than 470 assets across more than 20 blockchains, operates a $1 billion lending book and offers listed derivatives through its Deribit integration.

Competitive outlook for banks and crypto firms

D’Agostino says only a small number of firms in traditional markets, including Goldman Sachs, Morgan Stanley and Bank of America, qualify as full-service prime brokers because they provide the full range of services at scale. He argues the crypto sector has remained even more fragmented, with other players such as Galaxy Digital, FalconX and Anchorage Digital active in parts of the market rather than across the full stack.

He says large banks are more likely to partner with existing crypto infrastructure providers than build their own competing platforms because the digital-asset market remains relatively small compared with global equities and fixed income. In his view, that balance could shift if crypto grows to 20% or 30% of global markets, but for now he sees greater competitive risk from emerging startups than from Wall Street incumbents.

In our earlier article on IBIT bitcoin options overtaking Deribit in open interest, we highlighted how U.S.-listed, regulated derivatives are becoming a key venue for institutional hedging and price discovery. We also noted that IBIT’s options market shows distinct positioning and higher implied volatility versus offshore markets, reflecting differences in investor access and hedging mechanics.

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