Galaxy Digital (GLXY) said on Tuesday it had launched over-the-counter (OTC) prediction market trading for institutional investors, becoming one of the first major digital asset firms to offer large-scale access to event-driven markets through a bilateral trading framework.
The Nasdaq-listed company said the new service, offered through its global market trading desk, will allow hedge funds, family offices and other institutional investors to trade contracts linked to political, economic and geopolitical events, while accessing liquidity and trade sizes not typically available through retail-focused prediction market platforms.
The company’s shares fell 6% on Tuesday, in line with the broader crypto-stock market.
The launch comes as prediction markets have gained traction among investors seeking ways to express views on real-world events ranging from elections and central bank decisions to regulatory developments. Platforms like Kalshi and Polymarket have seen rapid growth over the past two years, with many crypto-native companies entering the market.
Galaxy said its offer initially covers non-sporting event contracts traded at Kalshi and Polymarket, with plans to expand to additional venues. The firm will also allow clients to combine predictable market positions with hedges across equities, commodities and other asset classes, creating broader event-driven investment strategies.
As part of the launch, Galaxy facilitated a $10 million deal with crypto-focused hedge fund Arca tied to the outcome of the proposed CLARITY Act, legislation that would establish a regulatory framework for digital assets in the United States.
“Event-driven markets are becoming core to how sophisticated investors express macro views, and they deserve institutional infrastructure to match,” Jason Urban, Galaxy’s global co-head of digital assets, said in a statement.
Jeff Dorman, Arca’s chief investment officer, said prediction markets offered an effective way to hedge the fund’s exposure to ongoing negotiations in Washington over crypto regulation, but that liquidity constraints on existing platforms made it difficult for large investors to participate directly.
The move reflects a wider institutionalization of the prediction markets, a sector that has historically been dominated by retail traders. By acting as a principal counterparty, Galaxy can de-risk and facilitate larger transactions, while providing greater discretion than exchange-based trading.
Earlier today, Polymarket completed its first block trade in a transaction between crypto broker FalconX and trading technology startup Anera Labs.
Industry observers say the entry of firms like Galaxy could help deepen liquidity and improve pricing efficiency in the prediction markets by bringing professional investors into the space. Supporters argue that greater institutional participation could make market prices more useful as indicators of future performance, while critics warn that regulatory uncertainty remains a key challenge for the sector.
The launch further expands Galaxy’s growing derivatives and trading business. The New York-based firm, which offers institutional digital asset trading, asset management, staking and tokenization services, has increasingly positioned itself as a bridge between traditional financial markets and new digital infrastructure.
