Cantor Fitzgerald is launching institutional trading for prediction markets, becoming one of the first investment banks to provide institutional clients with access to block trading in event contracts.
For this service, Cantor will arrange and facilitate the execution of institutional-size block trades in event contracts for institutional clients through Kalshi’s block trading framework. Cantor is also collaborating with Susquehanna Predictions, a leading liquidity provider in prediction markets, to provide pricing and liquidity for its prediction markets coverage.
In essence, Cantor is applying the institutional trading model it has developed across equities and fixed income to a new regulated asset class. It will operate this business within its Global Markets division under Co-CEOs Pascal Bandelier and Christian Wall.
“Cantor has spent more than eighty years building institutional access to new markets, and prediction markets are the next one,” Bandelier said. “Prediction markets are growing rapidly, but institutional participation has not kept pace because investors have lacked the ability to transact at scale on a regulated exchange. The liquidity is here. With the launch of block trading, institutional investors can now access block trading in event contracts through an institutional intermediary they know and trust.”
While Cantor will initially facilitate block trades on Kalshi, additional venues are expected to be used down the road.
“Cantor brings deep institutional relationships and significant experience executing in equities and fixed income markets,” Max Crowley, vice president of business development at Kalshi, said. “We’re looking for partners who think creatively about where event contracts fit in a client’s portfolio, and who see the new use cases and hedging opportunities that come with it. Cantor is exactly that kind of firm.”
Susquehanna is the first quantitative trading firm to build a dedicated prediction markets business. It is one of the most active liquidity providers in event contracts.
“We believe the next area of material growth for prediction markets will be large institutional risk transfer,” Joe Grubb, head of business development at Susquehanna Predictions, said. “We are able to price and execute custom, tailored contracts for institutional counterparties desiring to hedge both general market and bespoke industry risk currently unserved by traditional insurance markets. Our ability to do so quickly and at scale will provide a valuable solution to this unmet market demand.”