Smartphone with displayed Coinbase logo and representation of cryptocurrencies are placed on a keyboard in this illustration taken, June 8, 2023. REUTERS/Dado Ruvic/Illustration
Dec 11 (Reuters) - Kalshi and Crypto.com said on Thursday they had launched a national alliance of prediction market operators that includes cryptocurrency exchange Coinbase, retail trading platform Robinhood and sports gaming operator Underdog.
The group, Coalition for Prediction Markets (CPM), comes as the U.S. prediction market has boomed since the start of the year. A federal court's dismissal last year of a prohibition on election betting has also fueled the sector's surge.
"This was the catalyst for growing investor interest, and this new coalition will further legitimize the sector, strengthening operating rules and setting a higher bar for integrity standards," said Nick Jones, founder of crypto firm Zumo.
Prediction market platforms let users trade binary contracts on outcomes in politics, sports, economics and entertainment.
Investors are increasingly viewing prediction markets as a potential growth area, prompting several major firms such as Robinhood and Underdog to enter the space. However, critics have argued that it is nothing more than an online gambling platform.
"The U.S. is the biggest frontier for prediction markets, and the momentum we're seeing makes a unified industry voice not just important, but necessary," said Matt David, executive board member of CPM.
Prediction market startups Kalshi and peer Polymarket have expanded rapidly in 2025, with Kalshi's valuation more than doubling to $11 billion after its latest funding round.
The coalition's focus will include strengthening the federal framework for prediction markets, setting nationwide integrity standards to curb insider trading, and pushing back against state-level overreach, the companies said.
"We spent years working with the CFTC because prediction markets must operate with strong federal safeguards that prevent insider trading, protect consumers, and ensure these markets remain transparent and corruption-free," said Sara Slane, head of corporate development at Kalshi and executive member of the coalition.
The group said more companies were in talks to join.
(Reporting by Pritam Biswas in Bengaluru; Editing by Sriraj Kalluvila)
