Professional institutions enter the arena! Wall Street hires traders to participate in prediction market trading.

Large financial institutions on Wall Street are rapidly entering the field of prediction markets, recruiting professional traders to capture arbitrage opportunities between event contracts such as sports events and political elections. This emerging market saw a surge in trading volume during the 2024 U.S. presidential election, and has now evolved into a gambling platform dominated by sports contracts.

According to a report from the UK’s Financial Times on Thursday, several well-known trading companies including DRW, Susquehanna, and Tyr Capital are building dedicated prediction market trading teams. Last week, DRW posted a job advertisement seeking traders with a base salary of up to $200,000, to “monitor and trade active markets in real time” on platforms such as Polymarket and Kalshi.

The Trump administration’s relaxed approach to market regulation has provided Wall Street institutions with an opportunity to enter this field. Some firms have established partnerships with prediction platforms to provide market-making and liquidity services in specific contracts.

Prediction market trading volume soared from less than $100 million per month at the beginning of 2024 to over $8 billion in December 2025. This explosive growth has attracted the attention of traditional financial institutions. Although liquidity is still far lower than traditional asset classes, arbitrage opportunities and hedging potential are driving professional traders to accelerate their entry.

Wall Street Giants Form Dedicated Trading Teams

Several top trading companies are aggressively expanding their presence in the prediction market business. Options trading giant Susquehanna is recruiting traders capable of “detecting incorrect fair value,” identifying “abnormal behavior” and “inefficiency” in prediction markets, and is also establishing a dedicated sports trading team. Crypto hedge fund Tyr Capital wants to hire prediction market traders who "already run complex strategies."

Tyr Chief Investment Officer Ed Hindi said, "We are extremely optimistic about the outlook of prediction markets, especially in terms of application to monetary policy and economic data in the coming years."

Madison Zitzner, vice president of quantitative research and prop trading at recruitment firm Selby Jennings, said that trading companies are “definitely in growth mode” for prediction markets; they “really want to understand the liquidity and scalability that these types of strategies can bring.”

Arbitrage Strategies Become Main Entry Point

Analysts point out that strict risk controls mean trading companies may avoid directly betting on when Trump will buy Greenland or which movie will win the most Oscars in March. The more attractive strategy is to arbitrage between markets offering different prices, similar to how high-frequency traders exploit price differences between different stock exchanges.

Joseph Saluzzi, co-founder of Themis Trading, said, "Large institutions will trade between markets—they won't be tossing darts to bet on which country Trump will invade. In such a completely new market, since the platforms are so isolated from each other, there will be many arbitrage opportunities."

Boaz Weinstein, founder of hedge fund Saba Capital Management, said at a closed-door meeting last October that prediction markets allow portfolio managers to hedge investments with greater precision, especially with regard to the probability of specific events. Weinstein noted that Polymarket showed a 50% chance of recession a few months ago, while credit markets showed about 2% risk. “You can come up with countless paired trades that you couldn’t do before,” he said. According to sources, Saba is currently “just observing” in prediction markets.

Market Makers Lead the Way in Providing Liquidity

Large market makers have shown greater enthusiasm. Susquehanna, led by billionaire Jeff Yass, was the first market maker on Kalshi and has established event contract partnerships with retail trading platform Robinhood. Institutions participating in Kalshi’s market maker program can obtain “financial benefits, reduced fees, different position limits and enhanced access,” as incentives to provide liquidity in prediction markets.

Sources reveal that Jump Trading and Amsterdam-based Flow Traders have also recently ramped up trading activity in prediction markets. Other companies hiring prediction market traders include New York trading startups Kirin and Anti Capital, Chicago crypto investor Sfermion, and Swiss trading group G20 Advisors. G20 recently posted openings for quantitative engineers, requiring the ability to “design models to estimate event probabilities, detect mispricing,” and manage risk.

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