Crypto prediction markets on Kalshi and Polymarket reached a combined $2.7 billion in weekly notional volume, according to data compiled by Dune Analytics and reported by Bloomberg. Bitcoin and other short-term cryptocurrency price contracts accounted for much of the activity.
Crypto ranked second only to sports on both platforms, reflecting growing participation in event-based contracts tied to digital-asset prices. The weekly total measures notional volume—the face value of contracts traded—rather than user deposits or platform revenue.
Why Exchanges Are Entering Prediction Markets
Crypto exchanges are adding prediction market products as spot trading volumes decline. Some platforms are building their own venues, while others partner with established operators. Coinbase offers crypto prediction markets through Kalshi, giving the exchange access to event contracts without operating the underlying marketplace itself.
Kalshi determines contract outcomes under each market's rules. Bitcoin and Ethereum price contracts on Coinbase settle using a 60-second CF Benchmarks average. The arrangement allows prediction products to operate within broader financial platforms.
Legal Challenges May Limit Expansion
Sports-related contracts face legal challenges across U.S. states, with regulators arguing that event contracts fall under state gambling laws while platforms cite federal derivatives oversight. Michigan's gaming regulator reached an agreement with Coinbase restricting sports contracts in the state, with existing positions required to close by October 10.
State-by-state restrictions could complicate nationwide expansion of prediction market products. The Michigan agreement applied specifically to sports contracts, not all event markets, leaving the broader legal question unresolved. Exchanges must weigh expected demand against regulatory and legal risk before expanding into new jurisdictions.
