Plaee CEO Calls Prediction Markets ‘P2P Financial Markets,’ Sees $1 Trillion in Volume by 2030 [Cointerview]

“Prediction markets are expanding the range of outcomes that can be priced. In that sense, they are closer to an information layer that turns collective expectations into a real-time signal.”

Leon Okun, chief executive officer of Plaee, made the remarks in an interview with Bloomingbit on Sept. 11, saying the core concept behind prediction markets is not new. Financial markets have long allowed investors to price uncertainty through a range of hedging tools. What prediction markets newly offer, he said, is a broader set of outcomes that can be priced.

Plaee is a business-to-business prediction-market infrastructure startup founded last year. It provides the infrastructure companies need to build their own prediction-market platforms. The company offers an integrated package spanning the front-end trading experience, back-office operations and compliance infrastructure. Its turnkey service is designed to help companies enter the prediction-market business quickly while retaining control over their brand, customers and revenue model.

Building on existing prediction-market platforms can leave companies dependent on another operator’s ecosystem, Okun said. In some cases, they may have to compete for the same market share. Existing platforms are also primarily focused on growing their own marketplaces rather than helping clients build differentiated standalone businesses.

Regulatory Controversy at Home and Abroad: ‘It Must Be Built In From the Planning Stage’

Prediction markets have grown rapidly since last year and have become a source of controversy in both South Korea and the US. According to CoinGecko, monthly global prediction-market notional volume nearly doubled in six months, rising to $52.8 billion in June from $27.1 billion in January. Second-quarter notional volume surpassed $110 billion, setting a quarterly record.

Some US state governments, including Nevada and Michigan, view prediction markets as closer to illegal gambling. Platforms including Kalshi are continuing legal battles with some state governments in the US. In South Korea, the Korea Communications Standards Commission blocked domestic access to global prediction-market platform Polymarket last month.

The situation shows prediction-market regulation cannot be treated as an afterthought and must be built into the business from the planning stage, Okun said. He added that as authorities’ approach to prediction markets continues to evolve, he hopes the sector will eventually be allowed to operate within regulatory frameworks in all markets, including South Korea.

Okun argued prediction markets should be viewed as peer-to-peer financial markets. Participants are not betting against a house or bookmaker that sets payout odds. Instead, they trade directly with other investors through an exchange, and prices are determined by the levels at which market participants are actually willing to buy and sell.

‘The Next Three Years Will Be Interesting’ as Plaee Plans More Partnerships

Plaee entered into a strategic partnership earlier this year with Crypto.com to reduce regulatory risk. Crypto.com was one of the companies that moved quickly to secure a license to offer prediction markets under US Commodity Futures Trading Commission oversight, Okun said. The partnership will help clients use CFTC-compliant prediction-market infrastructure and enter the market through a more streamlined process.

Citing estimates from Wall Street investment bank Bernstein, Okun said global prediction-market volume will reach $1 trillion by 2030. The industry has expanded at a dramatic pace, with monthly notional volume rising 130-fold over the past two years. The next three years will clearly be a very interesting period, he added.

Plaee plans to announce partnerships in the coming months with a range of companies including media, trading firms and financial information platforms, according to Okun. Prediction markets are no longer a niche area that attracts only a specific type of business, he added.