Coinbase, a leading cryptocurrency exchange, highlights this shift in its 2026 outlook report. The report suggests that gamblers may face taxation on so-called “phantom” income, where their total winnings are small and do not offset their overall losses. This could make traditional gambling less appealing due to unfavorable tax implications.

How Prediction Markets Could Benefit Gamblers

Prediction markets operate using financial contracts similar to derivatives, making them a potentially more advantageous option for tax-conscious gamblers. These markets allow participants to bet on the outcome of various events, with the potential for more favorable tax treatment compared to traditional sportsbooks and casinos.

This shift is particularly noteworthy as Coinbase has actively supported the growth of prediction markets. The exchange has partnered with Kalshi, a platform that facilitates this form of gambling, thus ensuring its customers have access to these emerging markets.

Regulatory Challenges and Coinbase’s Legal Battle

Despite the potential benefits of prediction markets, regulatory hurdles remain. Coinbase currently faces opposition from state regulators who aim to limit prediction markets’ ability to offer event contracts for sports. In response, Coinbase has filed lawsuits against Michigan, Illinois, and Connecticut, asserting that the Commodity Futures Trading Commission (CFTC) should exclusively regulate prediction markets, not state gaming regulators.

The company argues that Congress has already designated the CFTC as the sole authority over these markets. If successful, this legal action could pave the way for broader adoption of prediction markets by removing state-level obstacles.

As the landscape of gambling taxation and regulation continues to evolve, prediction markets stand out as a viable alternative. By offering a potentially more tax-efficient solution, they may attract a significant number of traditional gamblers seeking to minimize their tax liabilities.

Coinbase’s proactive stance in promoting and defending prediction markets underscores the growing importance of these platforms in the broader financial ecosystem. As we approach 2026, the impact of Trump’s tax reforms will likely drive an increased interest in prediction markets, reshaping the gambling industry as we know it.

The post Prediction Markets: 5 Amazing Insights on Trump’s Big Tax Impact appeared first on Crypto Market Insights: Dive In with CryptoUpdate.io.

Previously, Brazilian residents who disposed of up to 35,000 Brazilian reals (approximately $6,300) in crypto assets every month were not subjected to income tax. Any gains beyond this limit were progressively taxed, starting at 15% and escalating to as much as 22.5% for volumes surpassing 30 million Brazilian reals.

The new flat rate, effective from June 12, eliminates all exemptions and uniformly applies to all investors, regardless of their transaction sizes, reveals a report by local news outlet, Portal do Bitcoin.

While this change implies higher taxes for smaller investors, wealthy individuals may end up paying less. Previously, huge trades exceeding 5 million Brazilian reals, were taxed between 17.5% and 22.5%. With the new 17.5% uniform rate, many large-scale investors will experience a decrease in their effective tax rate.

Brazil’s provisional measure also widens the tax base, now encompassing crypto assets held in self-custody wallets and offshore crypto holdings. Taxation will now be assessed on a quarterly basis, with investors allowed to offset losses from the preceding five quarters. However, this loss deduction window will be more stringent from 2026.

Brazil also has plans to allow Bitcoin salary payments. In March, Brazilian legislators proposed a bill that would allow employers to pay a portion of their employees’ salaries in cryptocurrencies such as Bitcoin (BTC). However, under these proposed rules, crypto payments should not exceed 50% of an employee’s salary. Full crypto payments would only be permissible for foreign workers or contractors, and only under specific conditions outlined by Brazil’s central bank.

The post Brazil Imposes a Uniform 17.5% Tax Rate on Cryptocurrency Gains, Ending Previous Exemptions appeared first on Crypto Market Insights: Dive In with CryptoUpdate.io.