Coinbase's prediction markets achieved a remarkable milestone by reaching $100 million in annualized revenue within two months of their December 2025 launch. According to reports from crypto.news, this represents one of the fastest scaling products in Coinbase's history, coming from zero revenue in just seven weeks. The achievement occurred alongside a $394.1 million net loss and revenue decline to $1.43 billion from $2.03 billion year-over-year in the first quarter of 2026.
The prediction markets' early success is primarily driven by sports betting, with 80-87% of trading volume attributed to sports-related contracts since July 2024. As reported by crypto.news, the 2026 World Cup has been described as the largest gambling event in history, with Kalshi clearing more than $30 billion in June volume and Polymarket setting a record $10.8 billion in the same month. The sector-wide daily volume rose approximately 75% from the tournament's start, with open interest reaching $1.8 billion by the end of June.
TxFlow L1 has unveiled Probly, its first prediction market application built on the TIP3 liquidity standard, marking the next stage of its multi-application ecosystem expansion. At launch, the platform offers 172 live markets covering more than 7,000 events, including continuously rolling markets with durations as short as five minutes, backed by fully onchain settlement and TxFlow L1's shared financial infrastructure. The platform features 15 categories including politics, sports, crypto, finance, and geopolitical events, with discovery tools helping users explore trending and fast-moving events. Probly operates directly on TxFlow L1 through TIP3 standards, enabling real-time probability signals, verifiable onchain records, and automatic USDC settlement.
The category faces significant legal challenges, with Wisconsin suing Kalshi, Polymarket, Robinhood, Crypto.com, and Coinbase over sports-related event contracts in April 2026. According to crypto.news, attorney generals in at least four states are arguing these products function as illegal gambling, with Nevada's gaming regulators suing Kalshi in February and Arizona's attorney general filing in March. The industry's federal position rests on the Commodity Exchange Act, with the CFTC withdrawing proposed restrictions in January 2026 and issuing Polymarket a no-action letter.
Coinbase's success is attributed to its existing base of millions of funded accounts with verified balances and trading interfaces, as reported by crypto.news. The company launched prediction markets alongside stocks, commodity futures, and perpetual futures in December 2025, applying its largest retail distribution base to the category. This strategy aligns with Coinbase's 'Everything Exchange' thesis, which argues that users trading multiple assets through one platform are worth significantly more than single-asset users. Meanwhile, TxFlow L1's TIP3 architecture enables financial applications to operate on the same purpose-built network while connecting to shared execution and settlement infrastructure.
