Coinbase Risks Crypto 'Cannibalization' With Prediction Market Push: Mizuho
A Mizuho Securities survey found only 37% of Coinbase users would fund prediction market wagers with new cash, compared to 50% for Robinhood users. Analysts warn this could lead to cannibalization of crypto trading on Coinbase, limiting sales upside as the exchange expands into prediction markets. They reduced their price target for Coinbase shares to $280 from $320 due to softer trends, including a sharp Bitcoin decline. Both Coinbase and Robinhood users are far more likely to use prediction markets than non-users, reflecting overlapping interests in speculation. Data suggests some crypto demand has shifted to prediction markets and tokenized assets. Despite Coinbase not yet supporting prediction markets, most of its users are already participating elsewhere. Increased industry interest is evident, with the NYSE’s parent investing $2 billion in Polymarket, and growing Wall Street involvement. Coinbase shares were up 1% Tuesday, but down 10% for the month, though still positive year-to-date.
