Key insights
- Revenue diversification is speeding up. Revenue diversification means Binance US and Blockchain.com want to cut their dependence on cryptocurrency trading during a market slowdown.
- Prediction markets are attracting a lot of activity. Polymarket and Kalshi saw growth in their combined monthly trade between $17 billion and $72 billion in September 2026.
- Regulatory approval is still an obstacle. Regulatory approval could affect product availability and expansion across the United States because of licensing and disputes, over state gambling laws.
In a long period of market downturn, cryptocurrency exchanges are looking for new ways to generate revenue, with Binance US and Blockchain.com targeting the US regulatory approval for prediction markets. The applications they made to the Commodity Futures Trading Commission (CFTC) signal the increasing competition with event-based trading, which has seen volume increase as spot cryptocurrency trading has decreased.
Blockchain.com seeks broader derivatives access
Blockchain.com applied for two CFTC registrations last week, according to a Financial Times report published on October 21. The company seeks designation as a Designated Contract Market (DCM) and registration as a Futures Commission Merchant (FCM).
A DCM license would allow the company to operate a regulated exchange for eligible derivatives and event contracts. Meanwhile, FCM registration would allow FCM registration to act as a middleman, for customers who trade futures and other derivatives.
These approvals could give US retail and institutional customers access to contracts tied to sports, politics, economic indicators, and other real-world events. However, the applications do not guarantee approval or authorize an immediate launch.
Blockchain.com already provides international users with prediction market access through Polymarket and offers perpetual futures powered by Hyperliquid to eligible customers. Chief executive Peter Smith said customers wanted to manage digital assets, trade derivatives, and access event contracts without switching between applications.
The company is also preparing for a potential public listing. It has confidentially filed with the Securities and Exchange Commission and reportedly targets a valuation between $4 billion and $6 billion.
Binance US pursues a strategic comeback
Binance US has also applied to the CFTC for permission to enter the domestic prediction market sector. The exchange operates through BAM Trading Services and has faced years of regulatory challenges that weakened its US market position.
Chief executive Stephen Gregory previously confirmed plans to pursue a DCM license in August. The proposed expansion would allow Binance US to explore prediction markets alongside futures and options, subject to regulatory approval.
Additionally, the exchange is reportedly seeking up to $100 million in funding at a valuation near $1 billion. Capital could help with product development with business expansion and, with efforts to restore state money‑transmitter licenses.
Binance US is therefore pursuing a broader business model beyond conventional spot cryptocurrency trading. Its latest application comes as other exchanges seek similar opportunities to attract customers and diversify income.
Coinbase has partnered with Kalshi to offer event contracts, while Bullish has also pursued regulatory approval. Crypto.com has developed its prediction market business through OG.com and partnerships designed to distribute contracts through third-party platforms.
Prediction market growth contrasts with crypto weakness
The applications arrive as prediction markets attract greater trading activity despite declining cryptocurrency volumes. Figures cited by the Financial Times reveal that monthly volumes at Polymarket and Kalshi grew from $17 billion in January to $72 billion in September 2026.
The rise in Polymarket and Kalshi volumes was, than 300% while spot cryptocurrency trading volumes dropped 18 percent during the same months. This split shows a chance for exchanges to keep customers when digital asset markets are weaker.
Several major cryptocurrencies also recorded substantial annual declines, according to figures cited in the reports.
- Bitcoin fell approximately 28% over the previous 12 months.
- Ether declined around 42% over the same period.
- XRP and Solana each lost roughly half their value.
- Coinbase and Bullish shares nearly halved, while Gemini lost approximately 82% of its market value.
Meanwhile, Robinhood reported $156 million in event-contract revenue during the second quarter, compared with $100 million from cryptocurrency transactions. Its cryptocurrency transaction revenue fell 38% year over year.
The statistics prove the importance of trading platforms looking for products which can create activity without relying on cryptocurrency’s prices. But customer demand, operating costs and regulatory access will determine the revenue generated from the prediction markets.
Regulatory disputes could shape expansion
Despite growing interest, prediction market operators are dealing with issues about whether event contracts are considered federal derivatives or subject to state gambling laws. This difference could decide what kinds of products exchanges can sell and where users can use them.
Michigan regulators recently said Coinbase has agreed to stop offering event contracts to customers in the state. This came after a fight over whether the state has the power to regulate sports-related contracts. The core questions, about regulation are still not settled.
Similar disagreements have affected Kalshi and other operators as federal and state authorities contest the appropriate regulatory framework. Therefore, legal hurdles might not be removed entirely from the way for platforms to enter this space once FC-approved.
The United Kingdom also has a ban on retail access to prediction markets, where some products are considered binary options. These inter-jurisdictional variations would make international expansion difficult and complying with these requirements costly.
Conclusion
Other exchanges are aiming to obtain license to operate prediction market platforms to provide a fresh source of income in the cryptocurrency trading sector, with Binance US and Blockchain.com among those that are working on a license. Their use is indicative of the industry’s move towards event contracts and multiple, varied financial products.
However, increased volumes do not automatically mean profitability. Whether these exchanges become businesses and profitable ventures will depend on regulatory decisions, legal challenges and competition, from established operators.
