Galaxy Digital is exploring a liquidity provider tie-up with Polymarket and Kalshi, becoming the latest trading firm to seek exposure to the booming prediction market sector.
“We’re doing some small-scale experimenting with market-making on prediction markets, but I think you’ll eventually see us providing broader liquidity,” Michael Novogratz, Founder and CEO of Galaxy, told Bloomberg. The institutions-focused company intends to serve as a market maker on prediction exchanges, providing the regular trades required to deepen liquidity.
Institutional rivalry heats up
Galaxy is entering a crowded field. Jump Trading has reportedly commenced market making on Kalshi, while AQR Capital Management is weighing an expansion into sports betting. Susquehanna International Group is also active as a market maker on Kalshi.
These external participants supplement internal liquidity providers such as Kalshi Trading, which the exchange states is run independently without access to non-public information.
Founded in 2018, Kalshi operates under the oversight of the Commodity Futures Trading Commission (CFTC). The platform has expanded rapidly following a court ruling that permitted election markets. Trading volume is reportedly running above $50bn on an annualized basis, spanning sports, finance and macroeconomic events.
Polymarket navigates regulatory pressures
While Kalshi operates within the US regulatory fence, its younger onchain rival, Polymarket, faces a more complex landscape. Founded in 2020, the platform allows users to trade binary outcomes on politics, markets and culture. Despite facing regulatory headwinds - agencies in at least eight countries, from Romania to Singapore, have moved to block access - the platform is seeing record activity.
In October 2025, Polymarket recorded its strongest month to date, attracting nearly half a million active traders and surpassing $3bn in volume.
The company has added bitcoin deposits, cross-chain settlement, and new index products while preparing for a potential regulated US relaunch after halting domestic operations in 2022. It has also agreed to serve as DraftKings’ clearinghouse should the sportsbook move into prediction products through its Railbird acquisition.
The sector's growth has attracted high-profile capital. In August 2025, Polymarket announced a strategic investment from 1789 Capital, a firm backed by Donald Trump Jr., who also joined the advisory board. Terms were not disclosed, but media reports valued the investment in the tens of millions of dollars.
The convergence of crypto, betting, and financial markets is drawing scrutiny in Washington. Federal regulators, including the Securities and Exchange Commission (SEC) and the CFTC, are currently working on a crypto market-structure bill expected by year-end.
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