Coinbase to Acquire The Clearing Co. to Fuel Prediction Markets Push

Coinbase Acquires The Clearing Company to Expand Into Prediction Markets

Coinbase has agreed to acquire The Clearing Company, a startup specializing in prediction markets, to enhance its platform and expand into new financial product categories. This acquisition aligns with Coinbase's broader strategy to become an "Everything Exchange," integrating diverse asset classes such as stocks, derivatives, and prediction markets under one umbrella.

The deal is expected to close in January 2026 according to reports.

The Clearing Company brings a team with specialized experience in building and scaling event-based trading systems, including veterans from platforms like Polymarket and Kalshi. Their expertise is expected to help Coinbase refine and expand its prediction markets offering, which the company launched last week in partnership with Kalshi. The platform allows users to trade contracts based on real-world events, ranging from political elections to economic data releases.

Coinbase's move reflects a growing trend in the fintech sector, where traditional and digital financial platforms are increasingly integrating diverse trading options to capture market share and user engagement. Rivals like Robinhood, Kraken, and Gemini have already started offering similar services, including equity trading and prediction markets. By acquiring The Clearing Company, Coinbase aims to strengthen its position in this evolving landscape.

A Strategic Shift Toward Diversification

Coinbase's acquisition of The Clearing Company marks its tenth deal in 2025, underscoring its aggressive expansion strategy. The startup, founded earlier this year, previously raised $15 million in a seed round led by Union Square Ventures and Coinbase Ventures. This acquisition allows The Clearing Company to leverage Coinbase's global user base and infrastructure, accelerating the growth of prediction markets.

The Clearing Company's leadership, led by Toni Gemayel, has deep experience in the prediction markets space. Gemayel previously served as head of growth at Kalshi and brings a strong background in scaling digital trading platforms. His insights are expected to play a pivotal role in expanding Coinbase's market reach and enhancing the user experience on its prediction platform.

Regulatory Considerations and Market Growth

Prediction markets have seen a surge in popularity, particularly following the 2024 U.S. election, with weekly trading volumes now exceeding $4 billion. The Clearing Company has also taken steps to align with regulatory frameworks, including applying for a license from the U.S. Commodity Futures Trading Commission (CFTC). This move signals a broader industry trend toward legitimizing prediction markets as a regulated financial product.

Coinbase's entry into prediction markets has positioned it as a direct competitor to traditional brokerages and fintech platforms. By offering event-based trading alongside traditional assets like stocks and crypto, Coinbase aims to attract a broader range of investors and increase user engagement. The company has also introduced new tools for institutional clients, including the ability to create branded stablecoins and tokenize assets.

What This Means for Investors

The acquisition is seen as a strategic move to diversify Coinbase's revenue streams and reduce its reliance on crypto trading. Analysts note that the expansion into prediction markets and equities could significantly widen Coinbase's addressable market, particularly in the retail and institutional segments. Deutsche Bank Research analysts highlighted that the integration of new asset classes could help mitigate pricing pressure in the crypto trading sector.

Investors are also watching closely how Coinbase navigates regulatory scrutiny. While prediction markets are increasingly being recognized as a legitimate financial tool, their overlap with betting and gambling remains a point of contention. Coinbase's alignment with regulated partners like Kalshi and The Clearing Company's CFTC application could help establish a clearer legal framework for these markets.

Coinbase's stock has shown resilience in recent trading, with shares up 3% in early morning trading on December 22, 2025. The broader crypto market has also seen gains, with Bitcoin prices rising alongside renewed interest in digital assets. The acquisition was reported by CoinDesk on December 22, 2025.