BitGo and Susquehanna Launch OTC Trading for Prediction Market Contracts

Institutional clients can now trade prediction market contracts via an over-the-counter (OTC) structure that enables execution directly from custody accounts, bypassing retail platforms. The setup, launched by BitGo and Susquehanna Crypto, integrates bilateral execution, digital asset collateral and standard derivatives documentation.

The model follows a traditional institutional derivatives framework where trades are executed bilaterally through an OTC desk, not on public exchanges. Positions can be collateralized with existing digital asset holdings like BTC, ETH or stablecoins, without fiat conversion. Trades are documented under standard derivatives agreements, aligning with institutional workflows.

The service addresses access constraints that have limited institutional participation. Previously, most activity occurred on retail-focused platforms, creating operational friction. The new solution allows trading from existing custody accounts, reducing asset transfers and reliance on retail interfaces. "Prediction markets have developed into an increasingly relevant venue for price discovery, but institutional access has remained limited," said Matt Ballensweig, Global Head of Trading at BitGo.

For brokers and fintech firms, the development is practical, demonstrating that prediction market contracts can be offered using existing OTC execution, custody-based collateral and standard documentation models. This may lower operational barriers for firms evaluating these products.

The setup has limitations. OTC trading relies on bilateral pricing over open market liquidity, potentially affecting transparency and pricing. It also does not resolve broader regulatory uncertainty surrounding prediction market contracts, which remains unsettled in several jurisdictions.