Cantor Fitzgerald Enters Prediction Markets Space With Kalshi

Cantor Fitzgerald, the investment bank, is expanding into the prediction markets sector, as announced in a press release on August 19. The company will offer institutional clients access to block trading in event contracts on a CFTC-regulated exchange, specifically through Kalshi. Pascal Bandelier, co-CEO and global head of equities at Cantor, stated that the bank has been building institutional access to new markets for 80 years, and prediction markets are the next frontier.

The launch of block trading will provide liquidity for institutional investors to access event contracts through an intermediary they trust. Cantor will serve as an introducing broker, facilitating block trades in event contracts at a single price, "away from the central order book." Susquehanna Predictions, part of Susquehanna International Group, is the first quantitative trading firm to build a dedicated prediction markets business and is a significant liquidity provider in event contracts.

The partnership developments come amid growing popularity for prediction markets and increasing scrutiny from government entities, such as the New York City Council's investigation into Kalshi, Polymarket, Coinbase, and Gemini Titan for alleged deceptive marketing practices and targeting minors. Despite a lawsuit from the state of New York seeking shutdown and $36 billion in damages, Kalshi remains operational under the Commodity Futures Trading Commission's emergency authority.