Full Breakdown
Prediction Markets Move Toward the Mainstream
By Drooid · · How we work
Surge in Trading Volume
Over the past year, combined monthly trading volume on major U.S. platforms—including Kalshi, Polymarket and Polymarket US—has risen dramatically. Volume grew from under $5 billion in late 2025 to roughly $44.8 billion by mid-2026, and surpassed $50 billion a month later. Wall Street research firm Bernstein projects total prediction-market turnover at about $240 billion for 2026, a 370 % increase over the prior year, and foresees annual volume approaching $1 trillion by 2030. These figures illustrate a rapid scaling of capital tied to binary “yes-or-no” contracts.
Institutional Entry
Major brokerages are now packaging event-driven contracts alongside traditional products. Charles Schwab, which oversees more than $11 trillion in client assets, announced a partnership with Cboe Global Markets to offer S&P 500 prediction contracts structured as binary options. This follows similar moves by Interactive Brokers, Robinhood and Cboe, which have introduced their own event-style offerings. The involvement of large firms signals a shift from niche platforms to mainstream distribution channels.
Regulatory Response
The Commodity Futures Trading Commission (CFTC) launched a formal rulemaking process earlier this year to define how event contracts should be governed. The agency’s action reflects growing supervisory interest as the market expands. At the state level, several jurisdictions have challenged sports-related contracts, arguing they fall under state-level rules rather than federal derivatives regulations; those disputes are currently progressing through the courts.
Investor Considerations
Prediction-market contracts differ fundamentally from stocks, bonds or traditional derivatives. Each contract resolves on a single outcome and pays either a dollar or nothing, with fees that can accumulate for frequent traders. While the infrastructure—brokerage access, market data and regulatory oversight—now resembles that of broader financial markets, the risk profile remains distinct. Prospective participants should treat these products as speculative bets on specific events rather than substitutes for conventional investing.