Prediction Markets Surge as Kalshi Sets October Records

Prediction markets expanded sharply ahead of the US midterm elections. Kalshi and Polymarket recorded a combined $53 billion in trading volume in July, more than double May’s $26 billion, with sports markets accounting for most activity. Political markets were smaller: Polymarket averaged about $2 billion in monthly political volume this year, compared with less than $300 million for Kalshi. By July, House and Senate control contracts had attracted more than $30 million in trading. The latest figures show further growth in October. Kalshi reported about $65 billion in volume, 10% above its September record, while Polymarket US reached $10 billion, up roughly 15% from its previous monthly high. Open interest also set records at $2.05 billion for Kalshi and $384 million for Polymarket US. Kalshi represented nearly 83% of combined volume across Kalshi and the two Polymarket platforms, while US-regulated venues accounted for 95.6% of activity in that comparison. Robinhood’s prediction-market business generated $173 million in third-quarter revenue, more than its $120 million in crypto-trading revenue. Regulatory and product developments have supported the sector’s expansion: the CFTC withdrew a proposal that could have classified election contracts as gambling and later proposed a framework that would not automatically treat them that way. Kalshi also launched a Midterms Hub showing market-implied probabilities alongside polling averages. Sports remain a major source of activity, and the midterms will test demand for political contracts. For crypto traders, the rise of prediction markets is notable, but it does not demonstrate a shift away from crypto spot trading or signal a direct effect on cryptocurrency prices.