Morgan Stanley Partners with NEXTPredict to Explore Institutional Capital in Prediction Markets

Morgan Stanley's Strategic Move in Prediction Markets

Morgan Stanley has announced its role as a strategic partner for the upcoming NEXTPredict summit in New York, focusing on institutional capital in prediction markets. The summit, taking place on October 22 and 23, will feature a panel led by the firm's analyst Stephen Grambling, who specializes in U.S. gaming, lodging, and leisure.

Institutional Interest in Prediction Markets

Institutional interest in prediction markets has been increasing recently, with notable figures like JPMorgan's Jamie Dimon expressing considerations about entering the field. Dimon, however, framed much of the activity as gambling rather than investing. Goldman Sachs CEO David Solomon has also engaged with major operators in the sector, though concrete developments have been limited.

The NEXTPredict summit aims to explore the challenges and opportunities for institutional investment in prediction markets. Approximately 90% of current trading in this space is related to sports, a fact highlighted by Pierre Lindh, co-founder of NEXT.io, who noted that this is the first instance of a bank publicly engaging in such initiatives.

Day 2 agenda: Attend the Morgan Stanley Institutional & Capital panel.

The panel will address opportunities, challenges, and key questions surrounding institutional engagement with prediction markets.

— NEXTpredict (@nextpredictio) September 16, 2026

Market Dynamics and Valuations

Grambling emphasized that while prediction markets are gaining traction, institutional engagement requires a deeper understanding of market dynamics and associated risks. The financial landscape is witnessing significant valuations, with Kalshi aiming for a $40 billion valuation and Polymarket recently closing a funding round at $20 billion. In contrast, publicly traded entity DraftKings stands at around $13 billion.

Lindh pointed out that the current market structure needs diversification beyond sports contracts to maintain viability. He provided an example of a business facing unpredictable risks, illustrating how prediction markets could serve as tools for banks to hedge against events not covered by traditional instruments.

Regulatory Considerations and Future Prospects

Different banking sectors are exploring the potential of prediction markets, from research teams assessing market odds against polling data to considerations for internal forecasting. However, many banks are delaying engagement until clearer regulatory frameworks are established, particularly in light of ongoing state-level litigation.

Grambling’s involvement at NEXTPredict is significant given the industry's desire to move away from a gambling classification. His history of collaboration with NEXT.io, including participation in Kalshi’s $1 billion funding round and a joint sports betting show in March, underscores a commitment to advancing discussions in this emerging sector.

With 91 speakers confirmed and an expected attendance of around 2,500, the NEXTPredict summit is set to be a pivotal event for understanding the future of prediction markets.