Hedge Funds Are Poised to Enter Prediction Markets in a Big Way

In Brief

• Cantor Fitzgerald will act as the broker, facilitating block trades in Kalshi event contracts on behalf of its clients.
• Susquehanna International Group will act as the market maker, providing pricing and liquidity for those trades.

Cantor Fitzgerald is set to become one of the first major investment firms to offer its clients institutional trading access to prediction markets through Kalshi, marking another significant step in the market’s evolution toward Wall Street adoption.

The investment firm will act as a broker for institutional clients, facilitating large block trades on Kalshi’s event contracts. These privately negotiated transactions are commonly used by major financial institutions to execute substantial positions while minimizing the market impact associated with large orders.

Cantor’s global equities leadership sees a clear opportunity. As Pascal Bandelier, co-CEO and global head of equities at Cantor, noted, prediction markets are growing rapidly, but institutional participation has remained limited because investors have lacked the infrastructure to trade at scale on a regulated exchange.

That infrastructure is now beginning to take shape.

Susquehanna International Group will provide pricing and liquidity as a market maker for trades involving Cantor’s clients. Joe Grubb, Susquehanna’s head of business development, views institutional risk transfer as a critical next step in the continued growth of prediction markets.

The partnership could also expand the range of markets available to institutional investors. Cantor can request that Kalshi develop new event contracts for its clients, subject to regulatory approval and sufficient liquidity. Climate, weather, and economic indicators are among the markets expected to attract institutional interest.

For Kalshi, the relationship represents another major push toward Wall Street. While retail traders—particularly those trading sports-related contracts—have played a major role in the platform’s growth, Kalshi has increasingly invested in the infrastructure, compliance, liquidity, and market structure needed to attract professional investors.

The timing is significant. Kalshi completed its first block trade on an event-contract exchange in April and has since introduced additional partnerships and internal initiatives designed to make prediction markets more accessible and comfortable for institutional participants.

The broader implication is clear: prediction markets are moving beyond their early retail-driven phase. With brokers, market makers, hedge funds, and other institutional investors gaining access to scalable trading infrastructure, prediction markets are increasingly becoming a serious financial market for professional capital.

Disclosure: CNBC and Kalshi have a commercial relationship that includes customer acquisition and a minority investment.