In brief
- Coinbase is reportedly planning to launch a prediction market and tokenized equities on Dec. 17, according to Bloomberg.
- Demand for prediction markets is rising, with $28 billion in YTD trading volume.
- But regulatory pressure is increasing, with states issuing bans and lawmakers pushing for federal restrictions on election betting.
Coinbase is preparing to launch a prediction market and tokenized equities on December 17, according to a Bloomberg report Thursday.
The exchange has discussed entering these markets before, but it has not formally announced the products. Screenshots shared on X in recent weeks appeared to show early versions of the features, with prediction market Kalshi appearing to power Coinbase's own predictions offering.
Coinbase representatives pointed to a livestreamed event scheduled for December 17 when previously reached about the leaks. Coinbase did not immediately respond to a request for comment following the Thursday report.
The move comes as prediction markets see a surge in adoption. Trading volume hit $28 billion year-to-date through October, while studies suggest these markets outperform traditional election polling by roughly 30%. The U.S. predictive analytics industry is valued at about $14 billion, and is projected to grow to $32.85 billion by 2030.
Competitors are also ramping up offerings. Gemini secured approval this week to introduce its own prediction markets, while Crypto.com has partnered with Trump Media & Technology Group Corp. to support similar initiatives.
In the U.S., leading platform Polymarket was forced out of the market in 2022 under a Commodity Futures Trading Commission (CFTC) settlement for failing to register as a derivatives exchange. The CFTC approved it to return this November following the acquisition of QCEX, a CFTC-regulated exchange and clearinghouse.
But the sector is under intensifying scrutiny. State regulators have begun issuing bans, including a move by the Washington State Gambling Commission earlier this week declaring prediction markets an “unauthorized activity.” The commission said it is monitoring ongoing federal and state court battles that will determine the markets’ legal status.
At the federal level, lawmakers continue to target political betting, which is one of the most popular verticals on prediction markets alongside sports. Reps. Jamie Raskin and Andrea Salinas introduced the Ban Gambling on Elections Act last December amid an estimated $930 million in wagers on the 2024 election across major platforms.
Sen. Jeff Merkley has warned that betting on elections opens the door to corruption and undermines democratic processes. Internationally, several countries including Taiwan already bar election wagering.
Polymarket has also faced accusations of having volume inflated by wash trading. In November, researchers estimated as many as a quarter of the trades on the site could be artificial.
Amid the regulatory uncertainty, major fintech and crypto firms—Kalshi, Crypto.com, Coinbase, Robinhood, and Underdog—on Thursday announced the formation of the Coalition for Prediction Markets (CPM). The group aims to advocate for federally supervised, transparent access to prediction markets as adoption accelerates and state casino regulators assert oversight traditionally handled at the federal level.
“From day one, we wanted to be regulated. We spent years working with the CFTC because prediction markets must operate with strong federal safeguards that prevent insider trading, protect consumers, and ensure these markets remain transparent and corruption-free,” said Sara Slane, executive board member of the Coalition and head of corporate development at Kalshi, in a statement.
“Americans deserve clarity, not 50 conflicting interpretations,” she added. “As the first federally regulated prediction market, Kalshi saw firsthand how quickly this space was growing—and how urgently a unified industry voice was needed to advocate for access and consistency nationwide.”