Coinbase Launches Prediction Markets, Tokenized Stocks on Dec. 17 as Base Chain Tokens Surge

Coinbase Product Launch Analysis

Article Overview

Coinbase Global, Inc. is preparing to launch two new product categories on December 17, 2025, in a move that aims to expand its role in the digital asset ecosystem. The new offerings include prediction markets and tokenized equities, both of which will be structured and issued internally by the company. This strategic pivot is designed to position Coinbase as a diversified financial infrastructure provider, moving beyond its core trading business.

The company has partnered with PNC Bank to offer institutional and private banking clients direct Bitcoin trading via a "Crypto-as-a-Service" model. This collaboration will allow Coinbase to enter traditional finance more deeply without becoming a full-service bank according to reports. Meanwhile, changes to its retail offerings include a new policy that will limit interest payments on USDC balances to paying "Coinbase One" subscribers, starting December 15 as data shows.

December 17 marks a pivotal moment for Coinbase as it plans to debut its prediction markets and tokenized stock offerings during a dedicated event. The company's internal development of these products aims to streamline compliance and capture more value from transactions. Analysts and investors are closely watching how these new services will impact the company's competitive landscape and financial performance.

How Markets Reacted

Coinbase's upcoming product launches have already begun influencing market sentiment, particularly for tokens on the Base chain. Several tokens, including ZORA and RUSSELL, have seen significant price surges in the days leading up to the December 17 event according to on-chain data. ZORA, for example, rose 13.7% in 24 hours, while RUSSELL surged 236% according to tracking data. However, these gains have come with warnings from industry observers about the volatility and speculative nature of some of these tokens as reports indicate.

Prediction markets, in particular, are drawing attention as Coinbase joins forces with Kalshi, a leading operator in the space. Kalshi will power the initial launch of prediction markets on Coinbase's platform, making it the sole provider for these services at the time of launch. The coalition formed by Kalshi and Coinbase, along with other exchanges like Robinhood and Gemini, seeks to promote transparency and consumer protection in this evolving market according to industry sources.

Tokenized equities are also gaining traction, with the monthly transfer volume for these assets recently surged 32% to $1.45 billion. Coinbase's ability to issue these products internally is expected to enhance its control over compliance and improve its revenue model compared to third-party offerings.

What Analysts Are Watching

Analysts are closely monitoring how Coinbase's expansion into new financial services will affect its long-term growth potential and profitability. Craig Siegenthaler of Bank of America Securities recently reduced his price target for Coinbase from $358 to $341, maintaining a "Hold" rating. This adjustment reflects growing caution among investors about the execution risks associated with such an ambitious product roadmap.

Financial performance has been strong so far, with third-quarter revenue reaching $1.87 billion, up from $1.21 billion in the same period last year. Net income for the quarter stood at $432.55 million, highlighting the platform's profitability even as it invests in new ventures. However, the recent share price, currently at around €230, has declined by 36% from its 52-week peak. A Relative Strength Index (RSI) reading above 70 suggests a nervous trading environment, with heightened volatility and mixed investor sentiment.

The December 17 launch will serve as a key test for Coinbase. A successful rollout could reinforce the company's transformation into a diversified financial services platform. However, any technical or regulatory hiccups could prompt investors to refocus on the core trading business and scrutinize the expansion more critically.

Risks to the Outlook

Coinbase faces several risks as it pursues its ambitious expansion. One major challenge is the regulatory environment, particularly in the United States. Prediction markets and tokenized equities exist in a legal gray area, and any missteps in compliance could lead to significant setbacks. The company's ability to navigate evolving regulations will be critical in determining the long-term success of these new offerings.

Another risk lies in user adoption and engagement. While prediction markets and tokenized equities represent innovative financial tools, they require a certain level of understanding and trust from users. Coinbase will need to invest in education and marketing to ensure that these products appeal to both retail and institutional investors.

Finally, the competitive landscape is intensifying. Rivals like Robinhood, Gemini, and Kraken are already entering the prediction markets and tokenized stocks space, with some operating outside the U.S. Coinbase's ability to differentiate itself through infrastructure, compliance, and user experience will be crucial in maintaining its market leadership.

What This Means for Investors

For investors, the December 17 launch represents a key inflection point for Coinbase. A smooth rollout could validate the company's broader vision of becoming a one-stop financial services platform. Success in these new markets could drive growth in both revenue and market share, potentially leading to a re-rating of the stock. However, investors should remain cautious about the execution risks and regulatory uncertainties.

In the short term, the share price could remain volatile as the market weighs the potential of these new services against Coinbase's current profitability. Long-term holders should monitor key metrics like user adoption rates, transaction volumes, and regulatory developments. Any signs of sustained traction in the new product categories could justify renewed optimism.