Why crypto is closer to a bet than stocks
A share is a slice of a company that makes profits, which is why the stock market pays off over time. A bitcoin has nothing like that behind it. Two senior European Central Bank officials made this point on the bank’s blog in 2022. They wrote that bitcoin “does not generate cash flow (like real estate) or dividends (like equities)”, so its market value “is therefore based purely on speculation”.
If a coin earns nothing, as bitcoin doesn’t, the only way to make money is to sell it to someone who’ll pay more than you did. The US Commodity Futures Trading Commission (CFTC) says much the same in its advice to traders, describing the value of virtual currencies as “completely derived by market forces of supply and demand”. In that respect a coin works more like a Pokémon card than a share.
That’s also why prices swing so hard. Bitcoin peaked at about $69,000 in November 2021, then fell to about $17,000 by mid-June 2022. A Bank for International Settlements study of crypto app use in 95 countries estimated that by late 2022, around three-quarters of users had lost money on bitcoin.
What the law says
Buying crypto isn’t gambling under US law. In 2015 the CFTC held that bitcoin and other virtual currencies are commodities, the same legal category as oil or wheat, so the agency oversees crypto futures and options. Some tokens can count as securities under SEC rules, but meme coins, which are built around internet jokes and trends, usually don’t. SEC staff said so in 2025 and compared them to collectibles.
Coinbase is regulated like a money transfer business. Its 2025 annual report says it holds money transmitter licenses in the states that require them, plus a BitLicense from New York’s financial regulator. In December 2025 it started offering prediction markets, and the report warns that regulators may treat those as gambling.
Leverage and problem gambling
Leverage is where crypto can get riskier than a casino. Trading with borrowed money multiplies every price move, and the CFTC warns that traders “may lose more than their initial investments”. At a roulette table, the most you can lose is the chips you put down.
Crypto also seems to draw in people who already have gambling problems. A 2019 study of 876 regular gamblers found that those who traded crypto more often had more severe gambling problems. A 2021 study of 543 sports bettors and crypto traders found a similar link. People with higher problem gambling scores spent more time trading crypto each day, made more trades and put in more money.
What it means for you
Buying some bitcoin and holding it isn’t gambling, but you’re betting that someone will pay more for it later. Trading meme coins or using leverage is much closer to a casino, except there are no published odds to check. Only put in money you can afford to lose. If you notice yourself chasing losses, treat it the way you would a gambling problem.
Questions people also ask
Is Coinbase gambling?
No. Coinbase is a licensed crypto exchange, not a gambling site. The closest it comes is its prediction markets, where you buy contracts on whether an event will happen. Coinbase itself warns that regulators may treat those as gambling.
Is crypto trading riskier than gambling?
With leverage it can be. A casino bet can only cost you your stake. When you trade crypto with borrowed money, the CFTC warns that you may lose more than you put in.
Are meme coins gambling?
Legally they're closer to collectibles. SEC staff said in 2025 that typical meme coins aren't securities and that their value is driven mainly by demand and speculation. That also means buyers get no protection from federal securities law.
Are crypto casinos gambling?
Yes. Betting crypto on casino games or sports is gambling like any other bet. The coin is just the currency.
Sources
- ECB Blog, Bitcoin's last stand (Bindseil and Schaaf, 2022)
- CFTC, Customer Advisory, Understand the Risks of Virtual Currency Trading
- CFTC holds that bitcoin and other virtual currencies are a commodity (In re Coinflip, 2015)
- SEC Division of Corporation Finance, Staff Statement on Meme Coins (2025)
- Auer, Cornelli, Doerr, Frost and Gambacorta, Crypto trading and Bitcoin prices: evidence from a new database of retail adoption (BIS Working Paper 1049, 2022)
- Mills and Nower, Preliminary findings on cryptocurrency trading among regular gamblers (Addictive Behaviors, 2019)
- Delfabbro, King, Williams and Georgiou, Cryptocurrency trading, gambling and problem gambling (Addictive Behaviors, 2021)
- Coinbase Global, Form 10-K for 2025 (SEC filing)