Cantor Fitzgerald Enters Prediction Markets Space With Kalshi

Investment bank Cantor Fitzgerald is moving into the prediction markets space, according to a Wednesday (Aug. 19) press release.

The company is launching “institutional trading for prediction markets, becoming one of the first full-service investment banks to provide institutional clients with access to block trading in event contracts on a CFTC-regulated exchange,” in this case, Kalshi, per the release.

“Cantor has spent more than 80 years building institutional access to new markets, and prediction markets are the next one,” Pascal Bandelier, co-CEO and global head of equities at Cantor, said in the release. “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.”

Cantor will serve as an introducing broker, arranging and facilitating the execution of institutional-size block trades in event contracts for institutional customers. This will permit clients to negotiate block trades in event contracts at a single price via Kalshi’s block trading framework, “away from the central order book,” according to the release

Cantor is also working with Susquehanna Predictions, part of the Susquehanna International group of companies, per the release.

“Susquehanna is the first quantitative trading firm to build a dedicated prediction markets business and is one of the most active liquidity providers in event contracts,” the release said.

The partnerships are happening as prediction markets grow in popularity and face more pushback from government entities.

For example, the New York City Council last week launched an investigation into four prediction markets, including Kalshi, Polymarket, Coinbase and Gemini Titan, centered on allegations that they had used deceptive marketing practices and targeted minors.

A June report analyzed more than 1,100 videos made by Polymarket creators and found that 70% featured bogus sites the company used to create videos depicting phony trades.

Meanwhile, the Commodity Futures Trading Commission last week invoked its emergency authority to allow Kalshi to remain in operation despite a lawsuit by the state of New York aiming to shut down its event contracts.

The lawsuit accused Kalshi of operating an unlicensed gambling business and seeks as much as $36 billion in damages in addition to its shutdown.