Coinbase is asking U.S. regulators who oversee financial derivatives to continue treating prediction markets as they currently do. This request comes as these markets, which involve contracts based on the outcome of events, face increasing legal scrutiny.
Summary
- Coinbase has submitted a letter to the Commodity Futures Trading Commission arguing that prediction markets fall within existing regulatory authority.
- Chief Policy Officer Faryar Shirzad said event-based contracts resemble traditional futures and called for a principles-based framework.
Coinbase sent a letter to the Commodity Futures Trading Commission on April 30th, responding to their request for feedback on potential rules for prediction markets. In the letter, addressed to Secretary Christopher Kirkpatrick, Coinbase stated that these types of products are already covered by existing laws.
Coinbase recently submitted a statement calling prediction markets a rapidly growing part of the derivatives market. They argue that current regulations are sufficient to oversee them, and no new laws are needed. Faryar Shirzad, Coinbase’s Chief Policy Officer, urged regulators to focus on maintaining market fairness and honesty through flexible, principle-based rules.
Shirzad explained to reporters that event-based contracts aren’t a novel idea, drawing a parallel to traditional futures contracts. He noted that both types of contracts combine various pieces of information to determine prices. Coinbase also requested that the CFTC clarify how it plans to use its power to prevent contracts that could harm the public.
In a recent communication, we at Coinbase emphasized the importance of applying the same security measures to all crypto users, regardless of whether they buy and sell directly on exchanges like ours or through other services. We also believe that clear regulations are crucial for building and maintaining trust as more people get involved in the crypto space.
This announcement follows ongoing disagreements about event contracts popping up across various states, including a lawsuit in Wisconsin that’s pushing the need for new rules. Coinbase is joining other companies that are asking for clear federal guidelines, especially since it’s unclear which rules – state or federal – should apply.
Shirzad recently discussed stablecoin rewards as part of the CLARITY Act negotiations. He told Reuters that the updated wording protects the interests of cryptocurrency platforms while limiting rewards that function like bank interest. Senators Thom Tillis and Angela Alsobrooks reached a deal that restricts returns on deposits but still allows platforms to offer incentives for using their services.
As the Senate Banking Committee plans to review the CLARITY Act around May 11th, Coinbase has recently submitted information about prediction markets, continuing its efforts to work with U.S. officials on various crypto regulations.
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2026-05-04 10:12