Coinbase's New Markets Push Blurs Lines Between Crypto and Traditional Finance

Coinbase Global Inc. is poised to enter a "new era" with the imminent launch of prediction market and stock trading features, according to leaked screenshots and statements from the crypto exchange. The company has teased the announcements for a December 17 livestream event, where it will unveil what it calls an evolution into an "everything exchange". The features, currently under development, include a prediction market platform integrated with Kalshi-a federally regulated market operator-and a stock trading service that could expand Coinbase's offerings beyond digital assets.

The prediction market functionality appears to be built on Kalshi's infrastructure, which is approved by the U.S. Commodity Futures Trading Commission (CFTC). Leaked screenshots obtained by tech researcher Jane Manchun Wong show Coinbase users predicting outcomes on topics ranging from politics to sports, with trading options in USDC or USD. One disclosure in the interface explicitly states that the service is offered "through KalshiEX LLC," highlighting the partnership according to the leaked screenshots. This collaboration gained momentum in early November when Coinbase agreed to custody USDC for Kalshi's event-based contracts.

Stock trading features are also in the works, though specifics remain unclear. Screenshots suggest Coinbase is exploring common stock and ETF trading, aligning with broader industry trends. Competitors like Kraken already offer tokenized stocks via blockchains, while Robinhood recently launched similar services according to financial reports. However, Coinbase's entry could signal a significant shift, given its public trading status and regulatory scrutiny. The company has sought SEC approval for stock trading services since at least June 2025.

Prediction markets have surged in popularity this year, with platforms like Kalshi and Polymarket reporting billions in trading volumes. As of November 2025, Kalshi had processed $17 billion in volume, while Polymarket surpassed $34 billion according to market data. The sector's growth has attracted major players, including the New York Stock Exchange owner, which invested $2 billion in Polymarket, and FanDuel, which plans its own prediction market according to industry analysis. Coinbase's foray into this space positions it to compete directly with these platforms, particularly as Kalshi and Polymarket vie for dominance according to market reports.

The regulatory environment remains complex. While Kalshi operates under CFTC oversight, traditional sports betting is legal in only 31 states. Coinbase's integration of prediction markets could face similar hurdles, though its partnership with a compliant platform like Kalshi may mitigate risks according to industry analysis. The company's December 17 event will likely address these challenges, alongside broader strategic goals outlined in its "System Update" announcement according to the leaked documents.

Industry analysts note that prediction markets offer unique value during crypto's downturns. Unlike volatile asset trading, these markets allow users to profit from accurate forecasts, regardless of broader market trends according to financial analysis. As Coinbase prepares to launch its services, the move underscores a broader industry shift toward diversified financial products-a strategy also pursued by exchanges like Coincheck, which recently completed its Nasdaq listing via a SPAC merger according to market reports.