Bernstein analysts predict that prediction markets could reach $1 trillion in turnover by 2030, driven by regulatory clarity and shifting user interests.
Prediction markets are on track for significant expansion, potentially reaching a turnover of $1 trillion by 2030, as highlighted by analysts from Bernstein. This surge is attributed to factors such as enhanced regulatory clarity and strategic partnerships with major corporations.
Bernstein emphasizes that federal-level regulatory acceptance is crucial for the growth of this sector, as it allows for a more expansive market compared to state-level regulations. The integration of blockchain technology and cryptocurrencies is also expected to facilitate global liquidity and attract institutional investors.
Shifting Focus in Trading Volumes
Trading volumes on these platforms have already seen a significant increase, soaring to $51 billion in 2025, partly driven by the heightened interest during the 2024 U.S. presidential elections. By early 2026, leading platforms like Polymarket and Kalshi reported a turnover exceeding $60 billion, with projections suggesting this could escalate to $240 billion by the end of the year.
Currently, sports betting dominates this market, contributing 61% of total volume. However, analysts predict a shift in user interests toward more diverse topics such as cryptocurrency and economic indicators, positioning sports as an entry point rather than the ultimate focus.
“The institutional market will grow around economic, business, and political contracts,” Bernstein noted, highlighting the need for investors to have access to these types of phenomena.
Forecasts indicate that the annual recurring revenue (ARR) for prediction markets could rise from $400 million in 2025 to $2.5 billion in 2026, driven by new user engagement and improved monetization strategies. Polymarket has notably shifted its business model away from zero commissions, with current ARR estimated at $420 million.
Emerging Distribution Channels
Bernstein analysts also pointed out the role of platforms like Robinhood and Coinbase as significant distribution channels for prediction markets. Robinhood, in particular, has seen success with its integrated offering based on Kalshi, achieving an ARR of around $350 million within a year of launch.
Investors are optimistic about Robinhood's stock, buoyed by the expected growth in prediction markets and a recovering crypto market. Despite a recent downturn, analysts believe the stock price has already absorbed weak first-quarter results, and sentiment may improve as trading volumes rebound.
“We expect revenue from prediction markets to grow from $150 million in 2025 to $586 million in 2026,” Bernstein projected, attributing this growth to upcoming events like the World Cup and increased political activity.
However, the taxation of winnings in prediction markets remains a complex issue, leaving analysts to ponder its implications for the industry.
