You asked me to explain how to launch crypto derivatives exchange in Europe.

Europe’s €3 trillion crypto-perp prize demands onshore liquidity and iron compliance

I'll explain how it works, and why most teams will fail.

Coinbase acquired MiFID II investment firm in Cyprus.

Kraken acquired licensed MTF, also in Cyprus.

Why?

Because MiCA doesn’t cover derivatives.

MiCA gets you:

- spot
- swaps
- custody

If you want derivatives you need something else.

Perpetuals aren’t just another asset class.

They're crypto-native product
They’re 75% of global crypto volume.
They’re also nightmare to European regulators.

I explain what exchanges are doing:

- Launch Contracts-For-Differences (CFDs) - well-known instrument regulated under MiFID. Popular in FX and synthetic securities

- Apply for an MTF or OTF license - multilateral or organized trading venues that allow listing fully regulated futures.

Kraken is already live.
Coinbase is preparing to launch products.

Both are now MiFID-regulated entities.

That’s only way to legally touch crypto perps in Europe today.

I explain big problem:

You cannot share your order book with your offshore venue.
You cannot systematically route to global liquidity.
You cannot consolidate depth across jurisdictions.

ESMA says:

- Shared order books: banned.
- Systematic routing offshore: prohibited.
- Non-EU Liquidity Providers: only ad hoc, not automatic.

If you launch in Europe - you start from zero.

No depth.
No spreads.
No arbitrage sync.

All liquidity has to be built onshore, under EU law.

That’s why sourcing liquidity is now hardest problem.

And why MiFID perps are most complex product to launch in crypto.

Prize is massive.
€3 Trillion European market is real.
Only teams with regulatory experts, real LP access, and MiFID license will win

Everyone else will burn in compliance hell.

That's exact blueprint - studied this from every angle.