Wintermute Enters Prediction Markets as Liquidity Provider

Crypto liquidity provider and trading firm Wintermute says it is providing liquidity on prediction markets as the industry continues to expand.

The firm, which handles $3.5 trillion in annual trading volume, said on Friday that it is extending its institutional trading to prediction markets and would provide “two-sided markets across event contracts on leading venues,” without specifying the platforms. 

Jake Ostrovskis, head of OTC trading at Wintermute, said prediction markets have the “demand profile” of a major asset class but the liquidity profile of an “early-stage one.”

“For these markets to become a reliable real-time source of probability estimates, they need sustained two-sided liquidity. That depth tightens spreads, supports larger trade sizes, and in turn improves the signal embedded in market prices,” he added.

Wintermute said prediction markets are moving from a “niche forecasting tool” into a broader venue for trading event risk, and it will be posting continuous bid and offer prices across event contracts.

Source: Wintermute

This helps reduce spreads, support larger trade sizes, and improve the reliability of market-implied probabilities, it said.

Wintermute added that the market also overlaps with its existing crypto infrastructure, as it already manages spot, derivatives, decentralized finance and over-the-counter crypto markets.

The move could accelerate integration between prediction markets and broader DeFi protocols for collateral reuse, yield strategies on locked capital, or oracle feeds derived from prediction market prices.

Related: Kalshi backs prediction markets lobby group with former Trump official

The two leading prediction markets, Kalshi and Polymarket, have a notional weekly volume of around $5.8 billion, with almost 400,000 active markets and 42.7 million weekly transactions, according to DeFiRate. 

Kalshi, which is regulated by the Commodity Futures Trading Commission, has the largest market share of the volume with 70%. Politics and sports dominate the betting on both platforms. 

Comparison of stats between Kalshi (green) and Polymarket (purple). Source: DeFiRate

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