Cryptocurrency exchange OKX has acquired a key European Union license that will enable the company to offer derivatives products throughout the region, potentially opening the door to a more advanced segment of the trading community. 

In a March 12 announcement, OKX’s Europe CEO, Erald Ghoos, confirmed that the exchange acquired a Markets in Financial Instruments Directive (MiFID II) license. The license will allow OKX to launch derivatives trading products for institutional investors across the EU.

Source: OKX

The announcement came less than two months after OKX secured a preauthorization under the Markets in Crypto-Assets (MiCA) framework, which allows the exchange to offer localized services across 28 markets within the European Economic Area.

Although the MiFID II and MiCA licensing regimes are seen as complementary, they serve different purposes. MiFID II applies to all types of financial instruments and requires crypto derivatives platforms to register. 

On the other hand, MiCA applies to crypto-asset service providers dealing with cryptocurrencies that are not considered financial instruments. 

Headquartered in Seychelles, OKX is one of the world’s largest cryptocurrency exchanges based on daily volume. According to CoinMarketCap, the exchange processed nearly $3.7 billion worth of spot trades on March 12. 

Related: Kraken secures MiFID license to offer derivatives in Europe

Growing demand for derivatives

Demand for cryptocurrency derivatives has been on the rise as more institutional investors enter the digital asset space. A November report by CCData placed the centralized crypto derivatives market at nearly $7 trillion, having climbed 89.4% and surpassing the previous peak in March of last year. 

Crypto derivatives volumes reached all-time highs in the fourth quarter of 2024. Source: CCData

A February 2024 report by EY predicted that the evolution of decentralized finance (DeFi) would continue to catalyze crypto derivatives markets. The report said:

“Despite the high-profile crypto firm bankruptcies in the 2022 crypto recession, which have led to increased calls for greater regulation of the crypto asset industry, including the derivatives-trading sector, it is expected that the crypto derivatives market will continue to grow and evolve with the launch of new products that address market participants’ investment and hedging needs.”

When Kraken secured its MiFID license last month, it cited Europe as “one of the most active regions for crypto derivatives trading.”

Although not referencing solely derivatives trading, CME Group called Europe the world’s second-largest cryptocurrency economy, accounting for nearly 18% of global transaction volumes. 

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