Bernstein Sees Prediction Market Volume Reaching $1 Trillion by 2030

JH Kim

Summary

Bernstein said trading volume in prediction markets could reach $1 trillion by 2030.
The report said the market's sports-heavy structure could be reshaped around economic, political, and business events as institutional investor participation increases.
The market sees room for prediction markets to expand into policy and political risk hedging as well as a financial risk management tool, with future institutional participation and the regulatory environment as key variables.

Forecast Trend Report by Period

Prediction markets could expand rapidly over the next several years and reach $1 trillion in trading volume by 2030, Bernstein said. The firm also projected a shift in the market's structure.

Crypto-focused media outlet Decrypt reported on April 14 that Bernstein said in a report that prediction market trading volume could rise sharply over the long term.

The report projected that the market's current sports-betting-heavy structure will gradually change. As institutional investor participation increases, prediction markets could increasingly center on economic, political and business events.

Bernstein expects the share of sports-related contracts to fall to about 31% by 2030 from roughly 62% now. In their place, companies and insurers could use prediction markets to hedge policy and political risks.

Market participants are also watching whether prediction markets can expand beyond simple betting into a financial risk management tool. Institutional participation and the regulatory environment remain the key variables.