Coinbase is facing a wave of user criticism after sending repeated push notifications promoting sports event contract bets during the March Madness college basketball tournament. Some users report receiving multiple alerts within a single hour, describing the practice as ranging from annoying to outright absurd. The backlash reflects broader concerns about the direction the exchange has taken since entering the prediction market space earlier this year.
In January, Coinbase launched prediction market betting for users in the United States through a partnership with Kalshi. The service allows customers to wager on the outcomes of a range of events, similar to offerings on platforms such as Polymarket. Critics argue that the past two months have seen the exchange aggressively use its app to steer its existing crypto user base toward sports gambling.
One user on X, posting under the handle AvgJoesCrypto, said they received three separate notifications about college basketball within a single hour on Thursday. The user described it as absurd that the largest American centralized exchange had pivoted to sports gambling at a time of significant trust concerns within the crypto industry. They also took issue with what they characterized as exorbitant fees tied to the service.
John Palmer, co-founder of PartyDAO, expressed a similar view regarding the notifications tied to March Madness games. The complaints come as prediction market platforms more broadly face legal pressure from state-level authorities across the country. The federal regulator, the US Commodity Futures Trading Commission, has meanwhile been pushing to assert exclusive jurisdiction over the prediction market sector.
Ahead of its prediction market launch, Coinbase filed lawsuits in December against regulators in Connecticut, Illinois, and Michigan. The exchange argued that the CFTC, rather than state gambling authorities, should hold regulatory authority over its platform. Cointelegraph reached out to Coinbase for comment on the user complaints but had not received a response by the time of publication.
The controversy extends beyond user frustration into the legislative arena, where several US lawmakers have called for new laws to address issues in prediction markets. Allegations that someone in government used Polymarket to profit from a bet on the removal of Venezuelan President Nicolás Maduro have prompted bills seeking to prohibit any sitting US President or member of Congress from participating on such platforms. The proposals reflect growing political scrutiny of the sector as it expands in the United States.
Both Kalshi and Polymarket have responded to insider trading concerns by introducing their own internal policies. Kalshi announced it would prohibit political candidates from trading on event contracts connected to their own campaigns. Polymarket separately introduced measures aimed at limiting markets considered easily manipulated or ethically sensitive, signaling that the industry is attempting to self-regulate even as external legal and legislative pressure mounts.
Originally reported by CoinTelegraph.
