Jump Trading to serve as Polymarket and Kalshi market maker in exchange for stake: Bloomberg

Jump Trading is reportedly investing in the two largest prediction markets, Kalshi and Polymarket, according to Bloomberg.

Terms of the deals are vague at the moment, though Bloomberg reports that Jump will provide market-making services in exchange for stakes in both businesses. The firm will receive "a set amount of equity" in Kalshi and be able to scale up its investment in Polymarket over time, Bloomberg reported, citing anonymous sources.

The Block reached out to Kalshi and Polymarket for confirmation.

Kalshi and Polymarket have been at the forefront of the prediction market craze unleashed by a more permissive U.S. Commodity Futures Trading Commission, which previously barred most event-based trading as a type of restricted binary option. Polymarket was last valued at $9 billion, while Kalshi has notched a valuation of $11 billion.

While both firms have competed to secure exclusive deals, some firms have formed relationships with both. Google Finance and the National Hockey League, for instance, have structured multi-year deals with both firms. Kalshi and Polymarket have both seen their monthly trading volume grow rapidly since September, even as crypto exchanges like Gemini and Crypto.com release competing products.

Expand Chart

Jump Trading is a significant player in crypto markets, as a market maker, investor, and R&D unit. The firm took a notable step back from crypto following the collapse of one of its major investments, Terra. That said, Jump has made many contributions to crypto tech, including leading development of the Firedancer Solana client and multi-blockchain bridge Wormhole.

Market makers provide liquidity for trading platforms by trading both sides of a market, stepping in when there is no natural counterparty for a buyer or seller.