Cantor Fitzgerald, a global investment bank, has announced the launch of institutional trading for prediction markets. This initiative makes Cantor one of the first full-service investment banks to provide institutional clients with access to block trading in event contracts on a CFTC-regulated exchange, initially Kalshi.
Cantor will function as an Introducing Broker, organizing and facilitating large, privately negotiated block trades in event contracts for its institutional clients. These block trades will be executed outside of the central order book on Kalshi's platform to manage price volatility. Susquehanna International Group, through its Susquehanna Predictions division, will support these trades by offering pricing and liquidity as a market maker.
Pascal Bandelier, co-CEO and global head of equities at Cantor, stated that while prediction markets are expanding rapidly, institutional involvement has lagged due to the absence of regulated exchanges allowing trading at scale. He emphasized that the necessary liquidity is now available. Cantor also indicated that it could request Kalshi to create new market contracts tailored to client interests, focusing on areas like climate, weather, and economic indicators. Hedge funds and family offices are particularly interested in using these contracts for trading and hedging specific business outcomes, such as iPhone sales or risks related to AI supply chains and commodity prices.
