Galaxy Digital is in discussions with platforms Polymarket and Kalshi to offer market-making services. This was revealed by its founder, Mike Novogratz.
According to him, the firm will ensure regular trading on the platforms to maintain liquidity.
“We are conducting limited experiments with market-making on prediction platforms, but I believe you will eventually see us as a provider of broader liquidity,” Novogratz stated.
Unlike traditional bookmakers, who act as a counterparty to every bet, Kalshi and Polymarket operate on a decentralized model: purchasing a “Yes” contract for any event requires a corresponding “No” offer from another participant.
To ensure stable liquidity, they actively attract professional market makers. Both companies have developed incentive systems, rewarding traders who maintain trading volumes.
Prediction markets have long remained niche and did not attract the attention of major Wall Street players. Until recently, the only company publicly confirming its role as a market maker on Kalshi was Susquehanna International Group.
However, the profitability of this business is beginning to change the situation. According to Bloomberg, Jump Trading has already started market-making on Kalshi. Cliff Asness, head of AQR Capital Management, announced the firm is considering entering the sports betting sector.
Two Pillars
The prediction market is currently represented by two main players — Polymarket and Kalshi. In November alone, their combined trading volume has already exceeded $48 billion.
Initially, Polymarket was the leader, gaining fame during the US presidential elections. However, in September, it was surpassed by the regulated CFTC platform Kalshi.
In recent months, both projects have attracted significant investments and entered into several strategic partnerships. In October, Polymarket received $2 billion from Intercontinental Exchange, the operator of the New York Stock Exchange.
Amidst its official return to the US market, the platform is negotiating to raise additional capital with a valuation of $12 billion to $15 billion.
In the same month, Kalshi secured $300 million, bringing the platform’s valuation to $5 billion, with an annual trading volume exceeding $50 billion. In November, the project received another $1 billion investment, increasing its potential value to $11 billion.
Evolution
Previously, Bernstein analysts stated that prediction markets are evolving into broader information venues. They noted that demand has expanded beyond politics and sports, encompassing economics, cultural events, corporate news, and financial indicators.
Experts highlighted that this is driven by growing regulatory clarity, institutional investments, the development of tokenization, and active integration with retail brokers. In particular, they pointed to Robinhood as a key partner of Kalshi.
The company offers over 1,000 contracts and accounts for 57% of the prediction platform’s volume. The broker’s monthly turnover in the segment reached $2.5 billion, equivalent to $300 million in annual revenue.
In October, Robinhood executive JB Mackenzie told Reuters that the firm is considering acquiring projects in the prediction market to expand its business.
“I am constantly monitoring potentially interesting offers — if one arises, we will examine it and assess its alignment with our objectives. We also have a strong engineering team capable of creating quality products independently. Therefore, we will seek a balance between these two approaches,” he said.
In November, rumours emerged that the largest American cryptocurrency exchange, Coinbase, plans to integrate Kalshi into its services.