Prediction markets surged to $29.4 billion in trading volume during May, prompting major brokers and institutional players to rapidly build out infrastructure and liquidity services. Retail broker Moomoo has partnered with Kalshi to offer event contracts on economic data, elections, and Fed decisions, joining Robinhood and Interactive Brokers in expanding prediction market access. Tradeweb has taken a stake in Kalshi to support institutional distribution.
On the institutional side, market makers are dividing into two camps. Wintermute has started providing liquidity on Kalshi and Polymarket alongside Jump Trading and Susquehanna, addressing liquidity shortfalls as monthly volumes exceed $20 billion. Galaxy Digital launched an OTC swap desk for event contracts, executing a $10 million trade on crypto legislation—five times larger than comparable exchange products. The divergence reveals growing demand for both public exchange liquidity and private, large-block trading infrastructure.
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FXnCO Insight
** Traders should expect tighter spreads and deeper markets as institutional liquidity providers enter, while large players gain access to OTC alternatives that won’t move public prices.
Source: Finance Magnates