Title: Coinbase’s “Everything App” Shift: Stocks, Kalshi & Onchain Rails

Content:

Introduction

On December 17, 2025, Coinbase announced a major product pivot: U.S. users can now trade stocks and access thousands of Kalshi-powered event contracts, and the company signaled that tokenized equities and deeper USDC-based settlement rails would follow. This isn’t just another listing spree—it’s a deliberate move to stitch TradFi products into crypto-native rails and win “share of wallet” from retail investors who today spread activity across multiple apps. Reuters and Investopedia covered the rollout live (Dec 17, 2025). Reuters (Dec 17, 2025) Investopedia (Dec 17, 2025).

Why Coinbase’s push is strategically different

Adding stock tickers to a crypto app could be cosmetic, but Coinbase’s approach is structural. First, it intends to use crypto-native rails (USDC and onchain tokens) to settle or collateralize trades. Second, it is bundling event contracts (Kalshi) and tokenized equities with its existing custody and product UX. Finally, it is selling a single-login “everything app” experience to keep balances internal to its ecosystem.

Operationally, this distinction is critical. If settlement, collateral, and routing live on crypto rails, Coinbase can lower friction for cross-asset strategies (e.g., instantly using USDC proceeds from a crypto sale to buy tokenized shares), shorten settlement windows, and offer 24/7 access—something incumbent brokerages still enforce by market hours and legacy clearing cycles. Analysts see this expanding Coinbase’s addressable market beyond volatile spot crypto trading.

Prediction markets vs. perps/options—where Kalshi fits

What Coinbase added via the Kalshi tie-up is event contracts: binary or variable-payout instruments that settle to cash based on a specific real-world outcome (e.g., “Will CPI print X?”). These differ from perps and options in important ways:

• Payoff design: Event contracts are outcome-binary or explicitly cash-settled to a determined event; options/perpetuals pay based on price paths, delta/gamma exposure, and often embed time value and implied volatility. Reuters (Dec 17, 2025).
• Leverage & margin profile: Perps/options provide built-in leverage and complex margin dynamics. Kalshi-style contracts are typically fully collateralized (no linear counterparty leverage) and are cleared through regulated DCO/clearinghouses in the U.S. context. CFTC (Aug 29, 2024).
• Use cases: Event contracts are ideal for discrete, narrative-driven hedges—trading Fed outcomes or election results—whereas perps are better for continuous directional bets and volatility trading.

Portfolio fit and new user behaviors

For investors, these instruments enable new strategies:

• Hedging macro and narrative risk: A corporate bond holder fearing a Fed surprise can hedge by buying an event contract tied to an interest rate outcome rather than layering on option structures.
• Trading earnings and narrative shifts: Event markets let retail investors express probability views directly (e.g., “Will company X beat EPS?”), offering risk-defined exposure with clear settlement.
• Sentiment & market signaling: Active traders can use contract prices as leading indicators for implied probabilities.

Practical allocation: For most retail investors, these should be small, tactical positions (single-digit percentage exposure) because event contracts can move rapidly and are concentrated around headline events.

What “24/7 tradable tokenized equities” could mean

Coinbase says tokenized stocks are coming, likely using USDC for settlement. While the technology for 24/7 tradability is straightforward, the legal implementation is complex. Investing.com (Dec 17, 2025).

Key mechanics and open questions include:

• Legal mapping: A token must either represent a legal claim on a share (issued by a custodian) or be a synthetic derivative. U.S. regulators generally treat tokenized stocks as securities, requiring strict compliance. CoinDesk (Sep 30, 2025).
• Primary issuance and corporate actions: To preserve investor rights (voting, dividends), token programs typically require coordination with transfer agents. Absent that, tokens may confer economic exposure only.
• Settlement & custody: Onchain settlement with USDC could be near-instant, removing T+2 frictions. Coinbase has separately worked on using USDC for collateral in futures contexts, foreshadowing similar uses here. CoinDesk (Jun 18, 2025).

Competitive map: Coinbase vs. Robinhood vs. IBKR

• Distribution: Coinbase leverages deep crypto-native distribution; Robinhood dominates broad U.S. retail; IBKR targets institutional clients. Coinbase’s advantage lies in cross-selling from a single custody rail.
• Compliance posture: While Robinhood and IBKR are established broker-dealers, Coinbase is newer to equities rules. However, Robinhood already distributes Kalshi contracts in places, indicating a converging market.
• Market structure: Incumbents use established clearing (DTCC). Tokenized rails could bypass parts of that stack, raising questions about liquidity pools and best execution.

Key regulatory fault lines

The competitive battleground is defined by three major regulatory hurdles:

1. Securities vs. Commodities vs. Gaming: Tokenized stocks are SEC jurisdiction; prediction markets are CFTC jurisdiction. However, states like Nevada have asserted gaming authority over event contracts, leading to regional blockages. Reuters (Nov 26, 2025).
2. Market surveillance: Event contracts tied to sensitive outcomes raise information-leak risks, requiring exchanges to scale surveillance.
3. Custody and settlement rules: Using USDC as settlement introduces AML/KYC questions. Regulators will push to ensure stablecoin-backed rails meet cash-equivalent standards.

TokenVitals investor checklist

Before diving in, use this checklist to assess the risks:

1. Fees & execution: Compare commission and slippage vs. your current broker.
2. Spreads & liquidity: Early tokenized markets can have wide spreads and shallow depth.
3. Counterparty & custody: Does the token represent a legal claim or a synthetic contract? Can you redeem tokens for registered shares?
4. Settlement medium: If trades settle in USDC, examine conversion and redemption pathways.
5. Regulatory coverage: Confirm if the instrument is SEC-registered or CFTC-cleared.
6. Operational risk: Check how corporate actions (dividends, voting) are handled.
7. Product rollout metrics: Watch for SEC filings and clearing partnerships (e.g., Nodal Clear).

Conclusion

Coinbase’s December 17, 2025, rollout is a bet on moving traditional financial activity onto crypto-native rails. For investors, prediction markets offer tactical narrative tools, while early tokenized equities represent promising but complex products. Always perform due diligence on legal wrappers and counterparty arrangements before committing material capital.

If you want, TokenVitals can run a health-and-risk scan on a sample tokenized equity or Kalshi contract to quantify counterparty exposure specific to Coinbase’s implementation.