Galaxy Digital Launches OTC Prediction Markets with $10M Trade

Galaxy Digital has launched a new over-the-counter prediction markets service for institutional investors, completing a significant $10 million trade with hedge fund Arca.

On June 2, 2026, Galaxy Digital announced its entry into the prediction markets space by introducing an over-the-counter (OTC) trading platform aimed at institutional clients. This platform allows participants to engage in contracts related to various political, economic, and geopolitical events, with the initial focus on non-sports contracts available on platforms like Kalshi and Polymarket.

The service is designed to provide hedge funds, family offices, and other institutional investors with access to liquidity and trade sizes that are typically unavailable on retail-focused platforms. The firm’s shares experienced a 6% decline on the same day, reflecting a broader downturn in the cryptocurrency market.

Galaxy's inaugural transaction involved a $10 million bet with Arca concerning the proposed CLARITY Act, which seeks to establish a regulatory framework for digital assets in the U.S. Jason Urban, Galaxy's co-head of digital assets, emphasized the growing importance of event-driven markets for sophisticated investors, stating, “Event-driven markets are becoming central to how sophisticated investors express macro views.”

Arca’s Chief Investment Officer, Jeff Dorman, noted that prediction markets offer a valuable avenue for hedging exposure to ongoing discussions in Washington about crypto regulations, despite facing liquidity challenges on existing platforms. This move by Galaxy signifies a trend toward the institutionalization of prediction markets, which have historically been dominated by retail investors.

By acting as a principal counterparty, Galaxy Digital can manage risk and facilitate larger transactions while providing greater discretion compared to exchange-based trading. Analysts believe that the involvement of firms like Galaxy could enhance market liquidity and pricing efficiency in prediction markets, although regulatory uncertainty remains a significant concern for the industry.

With this launch, Galaxy Digital continues to expand its derivatives and trading operations, positioning itself as a pivotal link between traditional financial markets and the evolving digital asset ecosystem.