Bipartisan U.S. senators introduced legislation to restrict prediction markets on regulated platforms. The bill prohibits Commodity Futures Trading Commission (CFTC) entities, including Coinbase partner Kalshi, from listing sports betting contracts. Lawmakers argue these products function as gambling and should fall under state-level oversight.
Coinbase shares fell over 2% in pre-market trading on Monday. The legislation challenges the company's strategy to become an everything exchange by offering diverse tradable assets beyond cryptocurrencies.
The proposed law also bans other casino-style games on these platforms. This move creates regulatory uncertainty for major exchanges including Coinbase, Kraken, and Robinhood.