Prime Brokers Bet on Prediction Markets — but US Lawmakers Are Already Pushing Back
Major prime brokers are offering clients access to prediction markets like Kalshi, even as US lawmakers propose legislation to ban certain contract types.Summary
Major Wall Street prime brokers, including Clear Street and Marex Group, are beginning to offer clients access to prediction market platforms like Kalshi, signaling significant institutional interest in event-based betting. This move comes as prediction markets hit a record $1.2 billion in weekly open interest, driven by retail and institutional demand, with firms like Coinbase and asset managers also exploring the sector.
However, this expansion is attracting regulatory pushback. US Senator Chris Murphy is developing a bill to ban what he calls "corrupt and destabilizing prediction markets," citing concerns over insider trading. Furthermore, other lawmakers have proposed legislation specifically prohibiting contracts related to war, assassination, or death.
The convergence of growing institutional adoption, evidenced by prime broker involvement, and increasing regulatory scrutiny from US lawmakers suggests that the next phase for prediction markets will be defined by this tension between financial integration and legislative guardrails.
(Source：BeInCrypto)