Prediction markets have spent years on the fringe of finance. Now, one of the sector’s fastest-growing players is preparing for scale — and it’s doing so by borrowing infrastructure from the traditional financial world rather than the crypto-native one.
- Kalshi selects Coinbase Custody to handle USDC settlement.
- Prediction markets continue drawing strong investor interest.
- Competition in the prediction-trading sector is rapidly increasing.
- Regulatory shifts are opening new opportunities for event-based platforms.
Kalshi confirmed that all USDC used on its platform will now be handled through Coinbase’s institutional custody division, turning the stablecoin settlement process into something that looks and behaves like legacy Wall Street plumbing. Instead of managing its own stablecoin storage and movement, Kalshi will outsource the responsibility to a regulated third party that specializes in safeguarding digital assets for large institutions.
The decision reflects a broader trend: prediction markets don’t work unless participants trust the platform is bulletproof. If traders fear that their money isn’t safe — especially when staking thousands on election outcomes, corporate earnings or geopolitical events — the model collapses instantly. USDC brings the price stability, and Coinbase provides the custody standard that hedge funds and financial advisers expect.
Momentum in the Background
While the custody announcement grabbed headlines, growth numbers quietly tell a bigger story. Participation across prediction platforms has risen dramatically throughout 2025. DraftKings has reported returns above 40%, Robinhood’s annual gains exceed 420%, and investor appetite for prediction-based exposure is outperforming expectations.
Kalshi hasn’t escaped the spotlight either. Investment proposals valuing the firm at more than $10 billion have surfaced — a huge leap from its previous $5 billion figure — following a June funding round in which it raised $185 million at a $2 billion valuation. Total capital secured to date now stands at $415 million.
An Industry Filling Up Quickly
Competition is not only rising — it’s diversifying.
- Trump Media & Technology Group, in partnership with Crypto.com, recently introduced its own prediction platform, Truth Predict, focusing on political and economic outcomes.
- Polymarket obtained a CFTC no-action letter in September, clearing its path to legally operate in the United States.
Suddenly, multiple heavyweight contenders are battling to define the future of event-based markets.
Why Kalshi’s Coinbase Partnership Matters
The real significance of the move is strategic, not promotional. The SEC recently clarified that state-chartered trust companies may serve as qualified custodians for crypto assets, provided they meet certain requirements. That update opens the door for firms like Coinbase Custody to play a much greater role in the digital-asset settlement stack.
Kalshi is positioning itself early — shifting custody while the rulebook is still forming.
The Bigger Picture
With regulatory momentum, a flood of newcomers, rising user participation and billions pouring into the sector, prediction markets are no longer an experiment. They are becoming an asset class — and Kalshi’s latest decision hints at what the infrastructure of that asset class may look like.
The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/kalshi-partners-with-coinbase-for-usdc-custody/