Coinbase to buy prediction market startup The Clearing Company

Coinbase has agreed to buy The Clearing Company, a San Francisco-based startup with expertise in prediction markets, to strengthen its new platform for event-based trading.

The Clearing Company is led by Toni Gemayel, a former head of growth at prediction market Kalshi.

The financial terms of the deal have not been disclosed.

Coinbase recently partnered with Kalshi to let users trade on real-world events such as elections and economic reports.

The Clearing Company raised US$15 million in a seed round in August 2025, led by Union Square Ventures with participation from Coinbase Ventures, and has applied for a clearinghouse license from the US Commodity Futures Trading Commission.

🔗 Source: CoinDesk

🧠 Food for thought

Implications, context, and why it matters.

Regulatory approval will shape Coinbase’s event market plans

The Clearing Company filed with the US Commodity Futures Trading Commission (CFTC) to register as a Derivatives Clearing Organization (DCO) 1. A DCO substitutes its credit for the parties, and it handles multilateral settlement with netting while meeting Section 5b core principles under the Commodity Exchange Act 2.
Firms without active DCO registration cannot clear CFTC regulated derivatives in house 2 3. Treatment of event based contracts can vary by jurisdiction, which adds classification ambiguity 2 3. The deal’s value hinges on the application’s timing, and some DCOs like BrokerTec Clearing Company later went dormant 4.
ZERO, a digital asset trading platform, petitioned the CFTC for DCO and Designated Contract Market (DCM) status, tying the bid to a White House directive that expanded CFTC oversight 5.

Data providers can benefit as regulated event markets grow

Clear event resolution rules drive trust in prediction markets 6. Polymarket uses UMA (Universal Market Access), a decentralized finance (DeFi) protocol, and its Optimistic Oracle 7. The oracle assumes answers are correct unless disputed with economic stakes, with bonded proposals and dispute steps verifying outcomes on chain 7.
Growing prediction markets need authoritative and auditable resolution data for elections, economic releases, and sports 8.
Compliance vendors help payment providers meet geolocation verification rules using multi source location data 3 9. Platforms also need full audit trails and role based resolution workflows to handle disputes with transparency 3 9.