Kalshi Drives Over $3B Notional Volume in Q3 2025 Prediction Markets as Polymarket Expands US Access

• Surging notional volumes driven by sports betting and retail traders

• Regulatory divergence: federally licensed Kalshi vs. offshore Polymarket and shifting licensing dynamics

• Strategic investments and acquisitions signaling deeper market integration

Crypto prediction markets surge as Kalshi and Polymarket post record volumes; explore regulatory shifts, market dynamics, and what this means for investors.

What is crypto prediction markets?

Crypto prediction markets are platforms that let users trade contracts on the outcomes of real-world events, aggregating information into prices. In recent quarters, these markets have surged as mainstream platforms and institutional investors enter the space, while regulatory and licensing dynamics shape access.

How do Kalshi and Polymarket differ in operation?

Kalshi operates with a federally issued license in the United States, enabling broader access to U.S. customers and offering features like parlays to boost activity. Polymarket has historically run as an offshore platform, facing regulatory scrutiny but expanding participation through on-chain data and international users. Data sources and interpretations vary, with Kalshi citing official filings and Polymarket relying on on-chain data; analysts note nuances in measurement.

Frequently Asked Questions

What regulatory considerations shape crypto prediction markets?

Regulators balance investor protection with innovation. In the United States, Kalshi’s federal license enables a broader set of contracts while state laws still apply. Offshore platforms face tighter registration and compliance constraints. Investors should monitor licensing developments, ongoing court cases, and platform risk controls.

How can a retail investor participate in crypto prediction markets?

Retail participation typically requires access to a regulated or semi-regulated platform, often via identity verification and fund transfers. Users should understand contract mechanics (payouts of 0 or 1 on completion), fees, and platform liquidity. Start with small bets and carefully track outcomes to assess risk and strategy.

Key Takeaways

• Regulatory moves shape access: Federal licensing can expand or constrain participation depending on jurisdiction and ongoing enforcement actions.
• Market interest is broadening: Sports and political event bets have driven spikes in notional volume, drawing retail and some institutional attention.
• Strategic investments point to longer-term adoption: Investments from major exchanges and acquisitions position prediction markets for wider integration into traditional markets.

Conclusion

In 2025, crypto prediction markets sit at a crossroads of sport, politics, and finance. Federal licensing for Kalshi and strategic investments by ICE and CME signal deeper market integration, even as regulators scrutinize operations. Stakeholders should stay informed, weigh regulatory developments, and practice disciplined risk management.