Key Highlights
- Investment firm Bernstein anticipates prediction market trading volumes will surge to $240 billion in 2026 and balloon to $1 trillion by decade’s end
- Leading platforms Kalshi and Polymarket have recorded $60 billion in trading activity in early 2026 — exceeding 2025’s entire annual total
- Kalshi’s weekly trading activity has skyrocketed from $100 million to more than $3 billion over a 12-month period
- Industry experts cite blockchain adoption and clearer federal oversight as primary catalysts for expansion
- Robinhood and Coinbase emerge as top publicly traded investment vehicles for sector exposure
The prediction market sector is poised for extraordinary expansion, with projections showing it could evolve into a trillion-dollar industry before 2030 concludes, based on fresh analysis from Bernstein, a prominent investment research firm.
Bernstein’s research team forecasts that aggregate prediction market trading will reach $240 billion during 2026 — representing a dramatic 370% increase compared to 2025 figures. With a compound annual growth rate hovering around 80%, analysts project annual market volumes could touch the $1 trillion mark by 2030.
Polymarket and Kalshi stand as the dominant forces in this emerging sector. The two platforms combined have already processed approximately $60 billion in market activity during the opening months of 2026. This figure has already eclipsed the $51 billion total volume registered throughout the entirety of 2025.
[[LINK_START_1]]Kalshi[[LINK_END_1]] commands over 90% of the prediction market landscape within the United States. The platform’s weekly transaction volume has experienced remarkable acceleration, climbing from approximately $100 million twelve months ago to beyond $3 billion currently.
Bank of America’s Julie Hoover characterized Kalshi as among the “fastest growing non-AI companies” operating in America today. She emphasized that the platform’s expansion trajectory mirrors the explosive growth patterns witnessed during the artificial intelligence revolution.
Key Factors Fueling Expansion
Prediction markets initially captured widespread attention surrounding the 2024 United States presidential race. The momentum sustained throughout 2025 as contracts covering sports events, digital currencies, and broader economic indicators attracted substantial trader interest.
Gautam Chhugani, an analyst at Bernstein, identifies three critical expansion catalysts: enhanced federal regulatory frameworks, strategic mainstream distribution alliances, and superior liquidity advantages versus state-regulated wagering platforms.
Blockchain infrastructure is emerging as another significant factor. The technology facilitates worldwide liquidity pools and empowers platforms to create contracts centered on highly specialized or targeted events, simultaneously reducing participation barriers for institutional capital.
Chhugani anticipates the contract composition will evolve substantially. While sports-related contracts currently constitute over 60% of total volume, he projects this proportion will decrease to approximately half by 2030 as institutional-grade contracts focused on economics, political events, and corporate developments gain market share.
Market competition is intensifying as new entrants emerge. Robinhood, DraftKings, and Underdog have either unveiled or are actively developing their own prediction market offerings.
Legal Challenges on the Horizon
The industry faces meaningful legal uncertainties. Litigation is currently active across 14 U.S. states, while four separate congressional proposals are advancing through the legislative process. Primary concerns encompass potential insider trading violations and jurisdictional disputes regarding regulatory oversight.
Certain states contend they possess regulatory authority over sports-oriented prediction contracts. The Commodity Futures Trading Commission, conversely, asserts exclusive federal jurisdiction over the entire prediction market landscape.
Chhugani maintains an optimistic outlook despite these hurdles. He believes platforms such as Kalshi and Polymarket will ultimately benefit from increasing cooperation with federal agencies including the Securities and Exchange Commission and the CFTC.
Robinhood’s prediction markets division recently celebrated its first anniversary and is currently producing $350 million in annualized recurring revenue. The segment represents roughly 30% of Kalshi’s aggregate volume and ranks as Robinhood’s most rapidly expanding business unit.
Chhugani identified Robinhood and Coinbase as the premier publicly accessible investment vehicles for market participants seeking indirect exposure to privately held prediction market enterprises.
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