Billions in trading volume, regulatory clarity, and new entrants set the stage for intensified competition in 2026
Prediction markets emerged as one of the fastest-growing financial segments in 2025, evolving from niche tools into mainstream platforms processing billions of dollars in volume. Traders increasingly turned to these markets to forecast outcomes ranging from sports and elections to interest rates and economic data.
Two platforms Kalshi and Polymarket led this expansion, forming a dominant duopoly that generated more than $44 billion in total trading volume during the year. Monthly volumes peaked above $10 billion in November, reflecting accelerating adoption. Sports-related contracts were the primary growth driver, though markets tied to economics and public policy also gained traction.
A key catalyst was Kalshi’s legal victory over U.S. regulators, which provided regulatory recognition and boosted institutional confidence. Strategic partnerships with major media and financial organizations further expanded reach and credibility.
The duopoly is now facing pressure from new entrants. Platforms backed by crypto exchanges, fantasy sports operators, and fintech firms launched competing products in late 2025. Some are embedding prediction markets as features within broader apps rather than standalone products.
As distribution power becomes more important than regulatory advantage, competition is shifting rapidly, signaling that prediction markets may become a core pillar of digital finance in the year ahead.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.