Coinbase CEO and board have warned that President Donald Trump’s proposed Big Beautiful Bill could redirect gamblers toward newly emerging prediction markets, a shift that could reshape how U.S. bettors interact with crypto.

What Happened

Coinbase recently announced a partnership with regulated U.S. exchange Kalshi, a platform that offers futures on real‑world events. In a public statement, the company cautioned that the Trump bill—aimed at loosening restrictions on gambling—might push bettors into prediction markets that are still in a gray regulatory space.

Why It Matters for Bitcoin

The intersection of gambling and crypto could accelerate demand for Bitcoin as a settlement asset in prediction contracts. However, the U.S. Securities and Exchange Commission (SEC) has been tightening scrutiny on crypto‑based betting, and any new legislation could prompt a regulatory review of how Bitcoin is used in these markets.

U.S. Angle

With the Federal Reserve’s recent rate hikes and a CPI report that shows inflation easing, investors are looking for new avenues to diversify. Prediction markets could become a new niche for Bitcoin exposure, but the extreme fear sentiment (Fear & Greed Index 16) suggests caution. ETFs for crypto are still awaiting SEC approval, so any shift toward regulated betting could influence future fund flows.

What to Watch Next

  • SEC’s stance on crypto‑based prediction markets and potential rule changes.
  • Progress of the Big Beautiful Bill through Congress and its final language.
  • Kalshi’s regulatory compliance updates and any new product launches.
  • Market reaction to upcoming CPI releases and Fed policy statements.
  • Bitcoin’s price movement in relation to emerging betting platforms.

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Source

The Block