Cantor Fitzgerald is building Wall Street-style trading infrastructure around prediction markets.
The financial services firm said Wednesday that it plans to offer its roughly 3,000 institutional clients access to prediction markets trading on Kalshi, making it one of the first full-service investment banks to give institutional clients access to block trades in event contracts on a CFTC-regulated exchange.
Kalshi’s market maker Susquehanna International Group will provide pricing and liquidity, the company said in a statement, while Cantor will be the acting broker, helping clients arrange and execute the trades.
“Prediction markets are growing rapidly, but institutional participation has not kept pace because investors have lacked the ability to transact at scale on a regulated exchange,” Pascal Bandelier, co-CEO and global head of equities at Cantor, said in a statement. “The liquidity is here.”
Still a retail-first trading vehicle, prediction markets are starting to look less like a betting product and more like a market Wall Street firms could use for trading and hedging risk. Firms like Kalshi or competitor Polymarket initially focused much of their trades on elections, sports and smaller retail trades but Kalshi has increasingly been trying to broaden its offerings to expand institutional participation.
Kalshi completed its first block trade earlier this year and it also partnered with Interactive Brokers, whose platform serves professional traders, hedge funds and other sophisticated investors.
“We believe the next area of material growth for prediction markets will be large institutional risk transfer,” Joe Grubb, head of business development at Susquehanna Predictions, said.