Coinbase (NASDAQ:COIN) is on a mission to be the one-stop shop for investing in anything. In another move to expand beyond crypto, Coinbase is expected to launch a prediction market in the US in the coming months.
This is expected to be followed by a global rollout as Coinbase leverages existing relationships to capture more business by adding value to its platform. Coinbase will also offer tokenized stocks as it targets a larger market, challenging not just other modern investment platforms but also putting legacy brokers, such as ETrade or Schwab, on notice. Notably, Charles Schwab has personally invested in prediction markets.
The size of the prediction market is estimated to be $18.02 billion. At least one prognosticator expects this market to grow to over $90 billion by 2023.
Last week, the Chairman of the Securities and Exchange Commission (SEC), Paul Atkins, announced Project Crypto. This initiative aims to make the US the global crypto capital. This will involve a broad series of initiatives. He has asked his staff to put together guidelines to determine when a digital asset is a security and when it is not. At the same time, Atkins is supporting the metamorphosis to digital securities or crypto asset securities. He explained:
“… many firms seek to “tokenize” their common stock, bonds, partnership interests, and other securities, or tokenize the securities of third parties. Much of this innovation is offshore today due to regulatory challenges in the United States. I also hear from our regulatory policy staff that firms—from household names on Wall Street to unicorn tech companies in Silicon Valley—are lined up at our doors with requests to tokenize. I have asked the Commission staff to work with firms seeking to distribute tokenized securities within the United States and to provide relief where appropriate to assure that Americans are not left behind.”
All of this plays into the vision of platforms like Coinbase. Onchain will soon become the norm, not the exception, and platforms like Coinbase are well-positioned to offer digital assets and markets, whether they are crypto, digital securities, prediction events, or anything else you can tokenize.
