Prediction markets have grown from a fringe forecasting tool into a $60 billion sector this year, and now one of crypto’s largest trading firms is moving in.
Much of that flow has come from geopolitical catalysts.
Polymarket set a single-day record of $478 million on Feb. 28 as the U.S. and Israel launched coordinated strikes on Iran, with politics markets alone accounting for $220 million.
The London-based firm is best known as a liquidity provider in spot and derivatives crypto markets, with over $10 billion in average daily trading volume.
That background may matter: Polymarket settles in USDC on a public blockchain, giving Wintermute a custody and execution edge that traditional TradFi market makers may lack.
Jake Ostrovskis, Wintermute’s head of OTC trading, said prediction markets have “the demand profile of a major asset class but the liquidity profile of an early-stage one.”
Continuous bid and offer quoting is meant to absorb large directional trades without sharp price moves, tightening spreads and improving the reliability of market-implied probabilities.
Kalshi raised $1 billion at a $22 billion valuation in May, disclosing $178 billion in annualized trading volume and an 800% surge in institutional flow over six months.
Robinhood Markets (NASDAQ:HOOD) has been rolling out event contracts on its app, giving retail traders direct exposure to prediction market growth.
Wintermute’s arrival likely signals prediction markets are moving beyond their early-stage liquidity profile.
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