Robinhood has significantly overtaken Coinbase, taking the lead in the prediction market as a key factor!

The two major fintech platforms in the United States, Robinhood and Coinbase, are engaged in fierce competition, with the focus of the new race shifting from traditional trading to the rapidly rising prediction market. Although both companies are based on digital finance, Robinhood clearly has the upper hand in its development trajectory for 2025. Last week, the prediction market surged again, with Kalshi's acquisition of Polymarket. On September 27 alone, Kalshi's volume exceeded $260 million, with a monthly trading volume of about $3 billion in September. Most of Kalshi's activity comes from trading with Robinhood. A Piper Sandler analyst stated that 25-35% of all activities on Kalshi occur on Robinhood, and the integration of the prediction market has brought Robinhood $200 million in added value, while Coinbase appears to have lost certain opportunities. Former Coinbase 1 Confirmation founder Nick Tomaino believes that if Coinbase pushes the prediction market, it could catch up with Robinhood's profit levels. This article is excerpted from The Drop newsletter, and the following is a comprehensive analysis report.

The gap in stock price performance continues to widen.

As of now, Robinhood's stock price has soared over 273%, with a market capitalization surpassing $131 billion, setting a historic high. In contrast, although Coinbase's stock price has also risen by about 50%, its market capitalization is only $99.8 billion. Looking at a longer time scale, over the past five years, Robinhood's stock price has accumulated an increase of over 318%, far outpacing Coinbase's mere 13% growth.

Is the prediction market the next wave of wealth engine?

Investors and analysts generally believe that the prediction market will be the next engine of revenue growth, especially for Coinbase. Nick Tomaino, the former founder of Coinbase 1 Confirmation, stated that the potential of the prediction market could bring Coinbase closer to Robinhood's profit model.

Robinhood is actively integrating prediction market features, and its collaboration with Kalshi has already shown results. According to Piper Sandler analysts, approximately 25% to 35% of Kalshi's trading activity comes from Robinhood, with users participating in the prediction market through the Robinhood interface, bringing about $200 million in added value to the platform.

Robinhood CEO Vlad Tenev holds a high level of confidence in this. He stated in a post on X that he has already seen prediction markets disrupting sports betting and reshaping the way news is consumed, providing traders with native price expectation tools.

Coinbase has not taken action yet, but is the opportunity still there?

Coinbase's actions in the prediction market remain conservative. Although the cryptocurrency wallet features continue to evolve, such as sending USDC using just a phone number, this appears insufficient in competing for users against mainstream applications like PayPal and Venmo.

Tomaino suggested that Coinbase, if unwilling to build a prediction market platform on its own, should consider collaborating with Limitless, which is built on the Base blockchain. Notably, Tomaino's venture capital fund is a major backer of Limitless, having invested $3 million in its seed round. However, in terms of trading scale, Limitless still pales in comparison to Kalshi. Kalshi's trading volume alone reached $3 billion in September, with a single-day trading volume exceeding $260 million just on September 27, while Limitless appears to be lacking in comparison.

The competition is heating up, and the future is promising.

Coinbase CEO Brian Armstrong mentioned earlier this year during a financial report meeting his interest in prediction markets. He expressed a strong desire to see more prediction markets move towards blockchain. As political issues increasingly impact society and attract attention, along with upcoming popular sporting events like the Super Bowl, the potential of prediction markets will further amplify, and the competition between Robinhood and Coinbase is bound to intensify.

Whether Coinbase can catch up with Robinhood by launching a prediction market on its own blockchain, or by emulating Robinhood's alliance partnerships, remains to be seen. However, it is certain that Robinhood has secured the first victory.

This article highlights how Robinhood has significantly overtaken Coinbase, taking the lead in the prediction market as a key factor! Originally appeared on Chain News ABMedia.