Prediction Markets Attract Users Who Never Become Traders

Kalshi surpassed $10 billion in weekly notional volume for the first time, the platform confirmed this week, with the record occurring during the FIFA World Cup. A 90-day study of 857,000 active Polymarket users by Bitget Wallet found that 60% had no prior onchain trading history, and once on the platform, most users averaged around 1,194 prediction market interactions compared with just 12 DEX trades. Rather than acting as a gateway into crypto trading, prediction markets are becoming a destination in their own right, with the World Cup demonstrating how quickly that audience can scale around major live events.

Kalshi processed $2.9 billion in World Cup trades within the tournament's first eleven days, exceeding its entire March Madness volume, while Polymarket's football markets surpassed $5 billion, compared with just $138,000 in World Cup trading during the 2022 tournament. For exchanges, trading volume is only part of the story; Kalshi has topped $2 billion in annualized revenue, putting it within striking distance of far older finance companies. Polymarket says its annualized revenue has surpassed $1 billion just six weeks after opening access to its US exchange, according to CNBC, and Citizens Bank projects the sector will reach $10 billion in annual revenue by 2030.

Coinbase is seeing the same behavioral pattern, with Toni Gemayel, Head of Prediction Markets, stating that only about 1% of users engage with prediction markets like any other asset class, while the remaining 99% use them "almost as an alternative to traditional media or entertainment." Those revenues are being generated by a user base that often has little interest in broader crypto trading, creating a business tied to real-world events rather than crypto market cycles. Whether that holds depends partly on whether event-driven engagement survives the absence of a major catalyst, as the tournament ends and the question remains what the 60% of users with no trading history do next.