According to one report from CNBC, Coinbase (COIN), the largest cryptocurrency exchange in the US, is preparing to launch its own prediction market in partnership with Kalshi, one of the largest federally regulated financial exchanges in the country.
Coinbase teases major updates
Anticipation around the prediction market has been increasing for almost a month. Recently, a screenshot of what appears to be Coinbase’s prediction markets dashboard was shared by Silicon Valley researcher Jane Manchun Wong in a post on social media site X (formerly Twitter), shedding some light on the upcoming product’s features.
The information first indicated on November 19 that Coinbase planned to introduce these prediction markets powered by Kalshi, with a formal unveiling for the “Coinbase System Update” event scheduled for December 17. Formal announcements regarding this new platform are expected soon, possibly as early as next week.
Bloomberg confirmed this report, stating that the cryptocurrency exchange will likely also announce a tokenized stock offering at the same event, in line with Tether’s same view reported earlier this week.
While Coinbase has refrained from confirming these developments directly to CNBC, the company has encouraged stakeholders to tune into the upcoming event for more details. The company has not announced a specific timeline for when the prediction markets will be available to users.
‘All Exchange’ status
Coinbase’s push to launch a prediction market is part of a broader strategy to transform itself into a ‘catch-all exchange’: a comprehensive platform for trading a wide range of assets, including cryptocurrencies, tokenized stocks and event contracts.
CEO Brian Armstrong expressed this vision earlier in May, emphasizing that the cryptocurrency exchange aims to grow into a leading financial services application within the next decade.
The development comes as Coinbase faces increasing competition from rivals like Robinhood (HOOD), Gemini (GEMI) and Kraken, all of which have introduced tokenized equity offerings for users outside the US and are exploring prediction markets to varying degrees.
Coinbase is expanding its range of financial instruments and making a series of acquisitions this year. This includes major deals such as the purchase of crypto derivatives exchange Deribit and on-chain advertising agency Spindl, as well as seven other major acquisitions.
This also follows a shift in investor sentiment towards digital assets, with the largest cryptocurrencies – including Bitcoin (BTC) – having fallen more than 30% since October, amid fears of the start of a new bear market.
In recent months, the exchange’s stock, which trades under the ticker name COIN, has also seen a significant decline of more than 39%, with its current valuation at $267 per share.
Featured image of DALL-E, chart from TradingView.com