Gemini pushes into prediction markets… "Preparing to launch sports and political event contracts"

Digital asset (cryptocurrency) exchange Gemini is seeking to expand its business by pursuing the launch of prediction market contract products. If the plan is approved, Gemini would make a full entry into the U.S. derivatives and event-based trading market.

According to Bloomberg on the 4th (local time), Gemini is in discussions to launch prediction market contracts that would allow bets on a variety of event outcomes such as sports games, elections, and economic indicators. The company aims to roll out related products as soon as possible and in May applied to the U.S. Commodity Futures Trading Commission (CFTC) for designation as a 'Designated Contract Market (DCM)'.

The approval process can take months to years, and there is a possibility that review timelines could be delayed due to the recent government shutdown. Both Gemini and the CFTC did not comment on the matter.

Some investment platforms are already entering the market through partnerships with licensed prediction market operators. Robinhood has partnered with Kalshi Inc. to offer event contract products to its users, and if Gemini builds its own platform it is expected to compete with existing market leaders such as Kalshi and Polymarket.

The prediction market industry has been rapidly growing alongside a surge in trading volume. Kalshi and Polymarket recorded record trading volumes after the 2024 U.S. presidential election, and major financial firms such as Intercontinental Exchange (ICE) and CME Group are also considering entering the market. Gemini rival Coinbase also said in a recent earnings release that it is preparing for the event contract market as part of building an 'Everything Exchange' encompassing all financial products.

At its IPO in September, Gemini said it planned to launch prediction market contracts across various fields such as the economy, finance, politics, and sports. However, since listing the stock has fallen 40% from the offering price and the company remains unprofitable. Needham said in a recent report that 'prediction markets are a promising opportunity for Gemini to diversify revenue sources beyond its traditional cryptocurrency trading.'