December 20, 2025 — A product launch from DraftKings, fresh lawsuits from Coinbase, and renewed momentum around Polymarket are turning prediction markets into one of the fastest-moving stories in fintech and crypto right now. What used to be a niche corner of “event contracts” is rapidly becoming a mainstream battleground—pulling in sportsbooks, trading platforms, regulators, and even major media brands.
At the center of this shift is a simple idea with outsized implications: turning real-world uncertainty—elections, wars, interest-rate moves, sports outcomes—into tradable prices that update in real time. Supporters argue these markets can aggregate information more effectively than polls or punditry. Critics counter that they’re simply gambling dressed up as derivatives.
Either way, the momentum is undeniable—and today’s headlines show just how quickly the category is expanding. [1]
DraftKings officially enters prediction markets with a CFTC-regulated rollout
DraftKings confirmed on December 19 that it has launched DraftKings Predictions, a standalone app and web product that allows eligible customers to trade event contracts tied to real-world outcomes. The company said it is entering prediction markets “under the oversight of the U.S. Commodity Futures Trading Commission (CFTC),” with sports and finance available initially and additional categories (including entertainment and culture) expected over time. [2]
A key operational detail: DraftKings says it plans to connect to multiple exchanges, starting with CME Group at launch. It also highlighted the planned rollout of Railbird Technologies and Railbird Exchange, which DraftKings previously acquired—positioning the company to deepen its footprint in federally regulated event contracts. [3]
Axios reports the app went live in 38 states, but with important carve-outs: DraftKings Predictions won’t be available in a list of states (including Washington, Montana, Arizona, Nevada and others), and it also won’t offer sports contracts in every market where it operates—decisions DraftKings linked to ongoing conversations with state officials. [4]
Why this matters: DraftKings isn’t just launching a new feature—it’s signaling that “event contracts” are now big enough to justify a standalone consumer product built for scale, marketing, and distribution. That’s a major step toward normalizing prediction markets alongside traditional sports betting and retail trading. [5]
Coinbase escalates the jurisdiction fight, suing three states over prediction markets
While DraftKings is focused on rollout, Coinbase is fighting the regulatory perimeter.
This week, Coinbase moved into open legal conflict with state authorities, filing lawsuits against Connecticut, Illinois, and Michigan. The exchange argues that prediction markets fall under the exclusive jurisdiction of the CFTC, not state gaming regulators applying gambling statutes. Coinbase’s chief legal officer, Paul Grewal, framed the lawsuits as an effort to stop a patchwork of state-level restrictions from blocking what Coinbase says are federally regulated transactions. [6]
The lawsuits land just days after Reuters reported Coinbase’s broader expansion plans: the company said it will start letting users trade stocks and event contracts, partnering with Kalshi, as platforms compete to keep retail traders “under one roof.” Reuters also notes regulators remain divided—industry players argue event contracts are federally supervised, while some states say they resemble betting and can spur speculation. [7]
The bigger story: The prediction-market boom is no longer just a crypto narrative. It’s becoming a U.S. regulatory showdown about who gets to define (and tax, police, and license) the product: federal market regulators or state gambling authorities. [8]
Polymarket’s political betting surge adds fuel to an already-hot category
Polymarket remains the most visible crypto-native brand in this space—and December’s activity is adding to the sense that “news is becoming tradable.”
A Meyka market update dated December 18 claims Polymarket saw a 100% surge in trading volume, driven primarily by political betting—highlighting developments tied to Venezuela and the U.S. political landscape as key drivers of activity. (Notably, Meyka labels its write-up as an AI analysis and includes a disclaimer that it is informational.) [9]
That Venezuela angle is not abstract. Reuters reported on December 19 that the U.S. imposed sanctions on individuals linked to Venezuelan President Nicolás Maduro and his wife, intensifying pressure on the government—exactly the kind of geopolitical headline that often pushes prediction-market prices and volumes. [10]
On Polymarket itself, Venezuela-related markets have drawn substantial attention. One example market—focused on possible U.S.–Venezuela military engagement—shows tens of millions of dollars in volume and multiple dated outcomes, illustrating how granular and financially significant these “headline contracts” have become. [11]
A data snapshot: open interest hits an annual peak, with sports leading and politics still powerful
Beyond day-to-day headlines, Polymarket’s broader footprint in 2025 is increasingly measurable.
A Binance News post citing Dune Analytics data reports Polymarket’s open contract volume (open interest) reached an annual high of roughly $326 million, up about 170% from around $120 million at the start of the year. The same update says the market is primarily divided into sports, politics, and crypto, with sports taking the largest share. It also references how political open interest spiked during the 2024 U.S. election period. [12]
Meanwhile, a major Dune + Keyrock research write-up published December 16 frames the trend as category-wide hypergrowth: it estimates monthly notional volume across major prediction-market platforms surged from under $100 million in early 2024 to over $13 billion in November 2025, with open interest above $500 million across the sector. Dune also says Polymarket’s monthly users grew from roughly 4,000 to more than 400,000, underscoring how quickly participation has scaled. [13]
Translation: Polymarket is no longer only “crypto Twitter’s favorite odds board.” It’s part of a much larger prediction-market wave that’s now attracting major consumer brands and drawing sustained regulatory attention. [14]
POLY token and potential airdrop: what’s confirmed vs. what’s rumor
Token speculation is amplifying the Polymarket story—especially among crypto-native users watching for an “airdrop moment.”
A widely circulated Binance Square post (user-generated content) claims Polymarket has 250,000–500,000 monthly active traders, projects $18 billion in 2025 trading volume, and sees 17 million monthly website visits—while suggesting an upcoming $POLY token could create a major airdrop opportunity for active traders. However, the post itself is explicitly framed as third-party opinion and should not be treated as official confirmation. [15]
What is confirmed: Blockworks reported in October that Polymarket’s CMO, Matthew Modabber, said the company plans to launch a native POLY token and an accompanying airdrop after its planned U.S. app rollout, emphasizing a focus on “true utility” and long-term durability rather than rushing a token to market. [16]
On the corporate side, Reuters reported Polymarket was exploring funding at a $12–$15 billion valuation range (per Bloomberg reporting cited by Reuters) and noted that Intercontinental Exchange had announced it would invest up to $2 billion in Polymarket as it prepared to re-enter the U.S. market. [17]
Bottom line for readers: The token plan and airdrop concept has credible reporting behind it—but timelines, eligibility mechanics, and the final token design remain uncertain. Anyone treating social posts as “airdrop guarantees” is taking a real risk of misinformation. [18]
How Polymarket turns news into tradable odds
The appeal of Polymarket—and the broader prediction-market movement—is that it creates a continuously updating price signal for real-world outcomes.
In most event markets, contracts effectively function like a binary payoff: if an event happens, the contract settles at one value; if it doesn’t, it settles at another. As traders buy and sell, prices shift to reflect the crowd’s collective assessment of probability—often faster than traditional “expert takes” can update.
Dune’s research notes that modern platforms vary widely in architecture, but highlights Polymarket’s combination of order-book trading, offchain matching with onchain settlement, and crypto-native resolution mechanisms. It also notes Polymarket uses oracle systems (including UMA’s optimistic oracle design and Chainlink in parts of the stack) to resolve outcomes—a core piece of why these markets can scale beyond traditional betting models. [19]
That “turning headlines into prices” framing is now spreading well beyond crypto audiences. The same Dune write-up points to expanding distribution through mainstream surfaces—embedding prediction odds into media, finance, and consumer apps. [20]
Regulation is the central tension: derivatives, gambling, or a new hybrid?
Prediction markets are surging precisely because they live at the intersection of two regulatory worlds: finance and gambling.
Polymarket’s own U.S. arc shows how complicated that can be. Reuters reported that in September 2025, the CFTC approved Polymarket to relaunch in the United States after the company’s $112 million acquisition of QCEX, a CFTC-licensed derivatives exchange and clearinghouse. Reuters also reported the CFTC issued a no-action letter offering relief on certain recordkeeping and reporting requirements for event contracts. [21]
At the same time, state regulators and casino interests argue many sports-linked event contracts look like unlicensed sports betting. Axios reports that land-based casino stakeholders and the American Gaming Association have attacked prediction markets as unlawful—while sportsbooks and trading platforms push back, seeking consistent national rules. [22]
This conflict is now organizing politically. Axios reported that Kalshi and Crypto.com helped form a Washington-based Coalition for Prediction Markets, with advocates arguing Americans need “clarity” rather than “50 conflicting interpretations.” [23]
And the media spotlight is intensifying. Business Insider reported that Kalshi secured a CNBC partnership (following a CNN deal) to integrate prediction data into coverage starting in 2026—while also noting state-level pushback, including cease-and-desist actions and litigation. [24]
What to watch next in 2026
The immediate question is not whether prediction markets will grow—it’s how they’ll be shaped by the next wave of entrants and the next wave of enforcement.
Here are the pressure points that will likely define 2026:
1) App distribution will matter as much as liquidity.
DraftKings and Coinbase bring massive user bases, compliance teams, and marketing engines. If event contracts become a standard tile next to “stocks,” “crypto,” and “sports,” the category could expand far beyond today’s core traders. [25]
2) Courts and regulators may decide whether state crackdowns stick.
Coinbase’s lawsuits aim directly at whether states can treat prediction markets as gambling—and whether the CFTC’s remit preempts state action. [26]
3) Politics and geopolitics will continue to drive surges.
As Venezuela-related headlines show—and as Polymarket’s own high-volume geopolitical markets illustrate—political uncertainty is a natural accelerant for prediction-market activity. [27]
4) Tokenization could add a new layer of incentives—and controversy.
If Polymarket launches POLY with an airdrop, it could accelerate user growth and liquidity. It could also invite a fresh round of scrutiny around consumer risk, marketing, and the line between “information markets” and speculative finance. [28]
The takeaway
As of December 20, 2025, prediction markets are no longer a single-platform phenomenon or a crypto curiosity. They’re becoming a mainstream product category—pulled forward by consumer brands like DraftKings, platform ambitions from Coinbase, and sustained demand for real-time probability signals in politics, finance, and global news.
Whether regulators ultimately treat these markets as legitimate financial instruments or as backdoor gambling will determine how far—and how fast—the industry can scale. But the direction of travel is clear: in 2025, “odds” are increasingly becoming just another kind of market data. [29]
References
1. www.draftkings.com, 2. www.draftkings.com, 3. www.draftkings.com, 4. www.axios.com, 5. www.axios.com, 6. www.financemagnates.com, 7. www.reuters.com, 8. www.reuters.com, 9. meyka.com, 10. www.reuters.com, 11. polymarket.com, 12. www.binance.com, 13. dune.com, 14. dune.com, 15. www.binance.com, 16. blockworks.co, 17. www.reuters.com, 18. blockworks.co, 19. dune.com, 20. dune.com, 21. www.reuters.com, 22. www.axios.com, 23. www.axios.com, 24. www.businessinsider.com, 25. www.draftkings.com, 26. www.financemagnates.com, 27. www.reuters.com, 28. blockworks.co, 29. www.axios.com
