Cryptocurrency exchange Crypto.com is stepping into the burgeoning prediction market space, offering users in the US a new way to engage with upcoming sporting events.
Although its background is primarily in cryptocurrency trading and services, Crypto.com has now launched a prediction markets offering, starting with bets on the NFL’s Super Bowl.
Unlike traditional sports betting, Crypto.com’s platform provides a derivatives-style trading experience that allows users to buy and sell positions on potential outcomes.
Currently, the offering is limited to outright Super Bowl predictions, with the Kansas City Chiefs holding the best odds at 23%. This means a $23 wager on the Chiefs could yield a $100 payout if they win.
Super Bowl predictions are just the beginning, however, with Crypto.com explaining that it will soon begin rolling out new markets.
One standout feature of the platform is its flexibility — bettors can exit their positions before the event if the odds shift in their favour, enabling users to lock in profits or cut losses.
The company highlighted the simplicity of the platform, describing it as a straightforward “Yes/No” decision-making process.
“Sports Event Trading is a CFTC-regulated derivatives trading feature available in the Crypto.com App and on the Crypto.com Web,” the company explained in a recent blog post.
A growing market for prediction platforms
Prediction markets gained mainstream attention during the US presidential election, with platforms like Polymarket processing billions of dollars in wagers.
Polymarket’s success demonstrated the potential of these markets to attract high levels of engagement, particularly during major events.
For instance, a single French bettor famously won nearly $80m on Polymarket by predicting a Donald Trump victory in the election.
Crypto.com’s venture into sports event trading, which the company says is now available in all 50 US states, appears to be a calculated move to capitalise on the growing popularity of these platforms.
As of this week, prediction markets for the upcoming Super Bowl have already exceeded $1bn in total wagers.
Crypto.com’s approach is distinct from traditional betting platforms, as it focuses on derivatives trading rather than spreads or money lines.
This positions the exchange as a competitor to platforms like Kalshi, which received Commodity Futures Trading Commission (CFTC) approval in 2020 to operate an event contracts exchange. However, Kalshi has faced regulatory hurdles in its attempts to expand into election-related event trading.
Regulatory challenges ahead
While Crypto.com has secured CFTC registration to offer derivatives trading in the US, the regulatory landscape for prediction markets remains complex.
The CFTC explicitly prohibits “gaming” activities for registered entities, which may explain why Kalshi has yet to introduce sports markets. These legal grey areas could present challenges for Crypto.com as it seeks to expand its offerings.
The legal and regulatory frameworks surrounding prediction markets often take years to resolve. Companies like Kalshi have already clashed with regulators, filing lawsuits to push the boundaries of what is permissible under current rules.
Crypto.com’s adherence to derivatives trading rules may help it avoid similar conflicts, but the evolving nature of this space could still pose risks.
In addition, the growing interest in prediction markets is likely to raise questions about what defines sports betting. While Crypto.com, Kalshi and others have been able to successfully push the boundaries, they could run into trouble in the future.