Gemini’s next big play? Prediction markets
Gemini Space Station Inc., the NASDAQ-listed crypto exchange led by Tyler and Cameron Winklevoss, is positioning itself to enter the fast-growing world of prediction markets. According to Bloomberg, Gemini has applied for regulatory approval from the US Commodity Futures Trading Commission (CFTC) to operate a derivatives exchange that could offer contracts tied to real-world events, from political elections to sports and financial indicators.
Gemini’s strategic push into regulated prediction markets
The move marks Gemini’s most ambitious expansion since going public in September. Once approved, the exchange’s new platform would enable users to trade federally regulated event contracts, giving it a foothold in a market that has drawn surging interest from both retail traders and institutional investors.
However, the approval process could take months or even years due to federal review delays, including those caused by the recent government shutdown. Gemini has reportedly discussed launching its prediction products “as soon as possible” once it receives clearance.
In contrast, competitors like Robinhood have chosen faster routes by partnering with existing licensed exchanges. Robinhood offers event contracts through Kalshi Inc., a CFTC-approved platform that has seen record activity. Between late October and early November, Kalshi reported weekly volumes exceeding $1.2 billion, while rival Polymarket also surpassed the billion-dollar mark during the same period.
Competition Heats Up: Kalshi, Polymarket, and Robinhood Lead the Pack
Gemini’s expansion would place it in direct competition with Kalshi and Polymarket, two of the most dominant players in the prediction market space, as well as traditional financial giants like Intercontinental Exchange (ICE) and CME Group. ICE, which owns the New York Stock Exchange, recently invested $2 billion in Polymarket at an $8 billion valuation, underscoring how traditional finance is rapidly converging with decentralised prediction trading.
In its IPO filing, Gemini revealed plans to offer event contracts covering “economic, financial, political, and sports forecasts.” Despite raising $433 million at a $4.4 billion valuation, the company’s stock has fallen roughly 40 percent since debuting, and its IPO prospectus described the firm as still operating at a loss while holding only a small share of US crypto trading volume. Gemini’s first earnings report as a public company is expected on 10 November.
Industry analysts view prediction markets as a potentially lucrative new direction for Gemini. A recent report by Needham analysts described the segment as an “attractive opportunity” for the exchange to diversify its revenue base. Still, the regulatory environment remains complex. While the CFTC has allowed firms like Kalshi to expand, state gaming authorities, who typically oversee sports gambling, are challenging federal oversight in court.
Google enters the scene with Kalshi and Polymarket
In a parallel development, Google has partnered with Kalshi and Polymarket to bring prediction market data to Google Finance. The integration allows users to view real-time forecasts on topics ranging from elections and inflation to sports outcomes.
Google’s move combines these elements to deliver real-time probability data directly through its Finance platform, positioning prediction markets alongside traditional tools like stock tickers and earnings data.
Google finance expands with AI-powered forecasting tools
The addition of prediction data follows Google Finance’s recent upgrade, which includes AI-generated financial summaries, expanded earnings-tracking features, enhanced data visualisation tools, and new support for Indian financial markets.
By integrating prediction markets, Google is bridging AI analytics with crowd-based forecasting, allowing investors to gauge real-time market sentiment across political, sports, and financial domains.
Sports prediction markets gain investor confidence, go mainstream
Both Kalshi and Polymarket have attracted massive venture backing. Kalshi raised $300 million from Sequoia Capital, Andreessen Horowitz, and Coinbase Ventures, valuing it at $5 billion. Polymarket closed a $2 billion funding round by NYSE-owner ICE.
The National Hockey League (NHL) recently became the first major sports league to partner with Kalshi and Polymarket, integrating sports outcomes into regulated prediction market systems.
Kalshi CEO Tarek Mansour called it “an important milestone for the industry,” adding, “It should be clear now prediction markets are here to stay.”
Regulatory tensions and the future of event-based trading
Prediction markets operate under federal oversight from the CFTC, while traditional sportsbooks fall under state-level regulation. This split has sparked legal challenges in several states, including Maryland, Massachusetts, Nevada, New Jersey, New York, and Ohio.
These disputes revolve around whether prediction contracts overlap with sports betting products. Federal approval lends credibility but also imposes stricter limitations on tradable events. The outcomes of these cases could define the future boundaries between financial trading and gambling in the US.
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