Galaxy Digital has officially expanded into prediction markets with the launch of an over-the-counter (OTC) derivatives trading desk tailored for institutional investors. The service, operated through the firm’s Global Markets division, targets hedge funds, family offices, and asset managers seeking large-scale, customized exposure to event-based contracts.
The launch was marked by a $10 million trade executed for crypto hedge fund Arca, linked to the outcome of the CLARITY Act, a key piece of U.S. legislation aimed at establishing a clearer regulatory framework for digital assets. While exact contract terms were not disclosed, the size of the inaugural transaction underscores the pent-up institutional demand for prediction market positions at scale.
Galaxy’s OTC desk covers a broad spectrum of events, from economic indicators and political elections to geopolitical developments and sports outcomes. Unlike retail-focused platforms such as Polymarket and Kalshi, this service allows counterparties to negotiate bespoke contracts, execute privately, and manage risk through cross-asset hedging. Institutional clients can offset prediction market bets with correlated positions in stocks, commodities, or other derivatives, moving beyond siloed event trading.
The move signals growing convergence between traditional finance and the prediction market ecosystem. With over $6 billion in prediction market volume during 2024—largely driven by U.S. election and macro contracts—institutions are increasingly viewing event-based contracts as legitimate tools for information discovery and portfolio diversification. Galaxy Co-President Damien Vanderwilt emphasized: “Prediction markets are becoming an increasingly important asset class and source of information.”
Galaxy Digital’s established crypto-focused client base provides a ready audience for the new offering, potentially accelerating the integration of prediction markets into institutional-grade infrastructure.
