Jump Trading, the Chicago-based trading firm, is moving from the sidelines to the cap table of the prediction market revolution.

The firm is reportedly set to acquire equity stakes in Kalshi Inc. and Polymarket—a move that gives Jump a direct piece of a sector now valued at a combined $20 billion.

How Jump Trading Is Shaping Prediction Markets

While neither platform has officially announced the partnership, Bloomberg on Monday reported the structured venture agreements, citing people familiar with the matter.

Rather than a cash injection, Jump's stake is being built through “equity-for-liquidity” arrangements.

Structured like venture agreements, the two deals prioritize “equity-for-liquidity” over traditional cash investment, underscoring how vital deep liquidity is to these platforms.

Jump's agreement with the CFTC-regulated Kalshi involves a set amount of equity.

The Polymarket stake will scale based on how much trading capacity Jump provides to the platform’s U.S. operations.

Jump has reportedly assigned more than 20 staffers specifically to the prediction market sector.

Is Institutional Money Changing The Game?

The deals position Jump with ownership in both leading prediction market platforms just as the sector enters a hyper-growth phase.

Platforms have surged in popularity, offering contracts on everything from Fed interest rate hikes to Super Bowl results.

While high-profile events like the presidential election and the Super Bowl draw huge volume, Jump’s liquidity ensures thinner, niche markets remain tradable.

The move is part of Jump's broader evolution beyond traditional equities.

Jump is currently fighting a $4 billion lawsuit from the Terraform Labs bankruptcy estate.

The suit alleges the firm secretly propped up the TerraUSD (CRYPTO: UST) stablecoin during its 2021 de-pegging event while cutting “backdoor deals” with founder Do Kwon.

Notably, Kwon was sentenced to 15 years in prison recently for his role in the $40 billion collapse.

The market-maker model raises fundamental questions about the core pitch of prediction markets.

Both Kalshi and Polymarket market themselves as a peer-to-peer alternative to traditional sportsbooks, claiming users bet against one another rather than a “house.”

But when an institutional giant like Jump Trading consistently takes the other side of retail trades, the distinction between a “peer” and a “house” could become murkier.

For the platforms, Jump provides the stability needed to go mainstream; for the retail trader, it means the competition could get much tougher.

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