Coinbase Fights CFTC's Proposed Ban on Prediction Markets

Coinbase Global, Inc. has voiced opposition to the U.S. Commodity Futures Trading Commission's (CFTC) proposed ban on certain prediction markets. The crypto exchange argues that the proposal oversteps the CFTC's statutory authority and fails to recognize the benefits of these markets. Specifically, Coinbase criticizes the broad definition of "gaming" used in the proposal, which would categorize various event contracts, including those related to elections, awards, and other non-sporting events, as impermissible.

Paul Grewal, Coinbase's Chief Legal Officer, emphasized that the CFTC's definition of "gaming" is inconsistent with legislative intent and historical interpretations. He argued that the proposal unfairly restricts valuable event contracts without considering their economic benefits. Grewal also suggested that the CFTC should focus on regulating individual cases rather than imposing a blanket ban. The crypto community has shown significant support for Coinbase's stance, with industry figures like CoinFund President Chris Perkins advocating for a more balanced regulatory approach that supports responsible innovation.