Galaxy Digital Launches OTC Prediction Markets Trading

Tapping into the current hot topic, Galaxy Digital says it has opened an OTC prediction markets offering, targeting hedge funds, family offices and other institutional clients.

The firm says the service, which will offer non-sports event contracts traded on Kalshi and Polymarket, enables institutions to access prediction market liquidity “at sizes and with a level of discretion not available through retail interfaces”.

The firm says it has plans to expand the offering to other platforms, and is also pushing its ability to pair these markets with more traditional assets, such as equities and commodities. It has executed its first trade, a $10 million deal with Arca, a crypto-native hedge fund, on a bilateral basis and based upon the outcomes associated with the passage of the Clarity Act.

“Event-driven markets are becoming core to how sophisticated investors express macro views, and they deserve institutional infrastructure to match,” says Jason Urban, global co-head of digital assets at Galaxy. “We’re giving clients a principal counterparty that can warehouse risk, build hedged strategies across asset classes, and execute at sizes and scale that actually matter to their overall portfolios.”

Jeff Dorman, chief investment officer at Arca, adds, “Arca is currently investing in themes closely related to the negotiations in Washington over Clarity. Hedging via prediction markets on Clarity is one of the most appropriate vehicles currently, but prediction markets are currently not a sophisticated institutional market with enough liquidity for a fund of our size. By utilising the OTC market with Galaxy, we were able to execute a trade that best suits our fund strategy.”