Market maker Jump Trading provides liquidity in exchange for equity in Kalshi and Polymarket, establishing a presence in prediction markets.

Bloomberg reports that market-making giant Jump Trading will provide liquidity to Polymarket and Kalshi in exchange for a small equity stake in both prediction market platforms, pioneering a new model of “liquidity as investment.”
(Background: Perpetual contracts expanding into prediction markets: Hyperliquid’s ambitions and challenges with HIP-4)
(Additional context: Prediction market Polymarket opens a physical supermarket giving away free vegetables! Kalshi offers a $50 credit to attract customers)

Table of Contents

• Why do prediction markets need Jump?
• The deeper meaning of the “liquidity as investment” model
• A $20 billion market and a race just beginning

Bloomberg reported on February 9 that market-making giant Jump Trading is about to provide liquidity to prediction market platforms in exchange for small stakes in Kalshi and Polymarket. This is not traditional venture capital investment but rather using their expertise in trading liquidity as a form of equity participation.

According to the report, Jump’s agreement with Kalshi involves fixed equity, while its stake in Polymarket will gradually increase as Jump provides more trading capacity in the U.S. market. In other words, the more Jump does, the more shares it gets. This new “liquidity as investment” structure elevates market makers from service providers to stakeholders sharing in the platform’s growth.

The background of this deal is that Polymarket is currently valued at about $9 billion, and Kalshi at around $11 billion. Together, these two prediction markets, worth a total of $20 billion, are vying for the title of “King of Prediction Markets.”

Why do prediction markets need Jump?

Liquidity is the core challenge for prediction markets. When you want to bet on the outcome of an event on Polymarket, you need someone willing to take the other side of the trade. If the market is too thin, with wide spreads, user experience suffers, and traders may face significant slippage to execute trades.

Market makers fill this gap. They continuously post bids and asks, narrowing spreads and making markets more efficient. For prediction markets, which feature many long-tail events with naturally dispersed liquidity, the role of market makers is especially critical.

According to reports, Jump has already staffed over 20 full-time employees dedicated to prediction market operations and is investing resources to develop event contract trading technology regulated by the CFTC.

The deeper meaning of the “liquidity as investment” model

Jump’s deal sets an interesting precedent: market makers are no longer just fee collectors and spread earners but are directly sharing in the platform’s growth through liquidity provision. This is fundamentally similar to Web3 thinking: exchanging contributions for ownership.

However, this also raises potential conflicts of interest. When market makers are also shareholders, do they have incentives to manipulate markets or prioritize their own interests? In traditional exchanges, such conflicts are tightly regulated. But for prediction markets, especially decentralized platforms like Polymarket, regulatory frameworks are still evolving.

A $20 billion market and a race just beginning

The ceiling for prediction markets extends far beyond political elections. Sports, weather, economic data, corporate events—any event with binary or multiple outcomes can theoretically be tokenized and traded. Goldman Sachs estimates that by 2030, the global prediction market could reach $100 billion.

The opportunity Jump is betting on with this liquidity provision is not just about the growth of two companies but about reshaping the entire information infrastructure. In a world where information becomes increasingly valuable, platforms capable of pricing information will be the next-generation exchanges.