What to know:
- Prediction markets topped $10.8 billion in weekly volume, setting a new trading record.
- Kalshi and Polymarket drove growth as traders responded to sports, politics, and news.
- Federal and state cases are sharpening the debate over event contracts and sportsbook rules.
Prediction markets recorded more than $10.8 billion in weekly trading volume, marking their highest level yet. A16z Crypto reported the figure, citing data from Artemis. The increase followed trading around global events worldwide, sports finals, corporate news, and geopolitical developments.
Speculation over a SpaceX initial public offering made headlines this week. It included US-Iran relations and three sports events: the NBA Finals, the Stanley Cup Final, and the opening of the 2026 FIFA World Cup. These subjects developed contracts for market players.
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Prediction Markets Hit New Trading Highs
The Artemis figures demonstrate the rise in activity since early 2025. Weekly volume averaged about $500 million. It crossed $1 billion last fall, hit $4 billion in winter, and remained in the $6-$7 billion range through spring.
The new record exceeds that previous range. It also represents the application of contracts for public outcomes. These markets enable individuals to wager on elections, economic data, sporting events, and big news stories.
Contract prices will fluctuate depending on how traders react to new information. They are considered an implied chance of a certain outcome. The model has attracted users looking for event-based exposure outside the stock and crypto trading.
A major factor in the sector’s growth has been the introduction of two platforms, Kalshi and Polymarket. Much of the recent volume increase was driven by Kalshi. Crypto-native users continued to participate in Polymarket.
Conventional banks are trying out comparable products. Charles Schwab entered the market through Cboe-listed yes-or-no contracts tied to the S&P 500. The contracts are used to speculate whether or not the index will close above or below a certain level.
CFTC Backs Novig as State Jurisdiction Fight Grows
The products are based on a set payout scheme. If the forecast is correct, the contract is paid; if not, it expires with no value. Schwab is in the process of creating a ‘Plus Zone’ feature that would provide part payouts for predictions that are close to the selected range.
Regulatory attention has increased alongside the sector’s growth. The Commodity Futures Trading Commission (CFTC) registered Novig as a Designated Contract Market (DCM). With that approval, the firm can launch a regulated sports prediction exchange throughout the nation.
The CFTC opposed state regulation of federally licensed prediction markets. It filed a lawsuit against Mexico for attempting to regulate these markets. The agency believes the platforms ought to be under federal control.
Kentucky has filed a lawsuit against Kalshi and Polymarket for violations of the sportsbook. The case joins the debate on the nature of event contracts as either financial contracts or gambling contracts. Those legal battles are still significant to platforms that span more than one state.
The $10.8 billion week indicates that prediction markets now have much more trading volume than they had in 2025. The data does not answer the regulatory issues facing the industry. However, it does show high demand during a week of important public events.
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