A recent report from Macquarie Equity Research reveals that Kalshi captured approximately two-thirds of the prediction market trading in June, a month that saw significant growth due to the FIFA World Cup.
Overall, prediction markets achieved over $50 billion in trading volume during June, marking a record-setting month for the industry as World Cup-related trading surged and strategic partnerships flourished.
Kalshi solidified its position as the market leader by generating around $33 billion in monthly trading volume, which represents about 65% of the total market. This is an increase from an estimated 57% market share in May, indicating a robust growth trajectory that suggests the prediction market sector could operate at an annualized rate exceeding $500 billion.
Macquarie emphasized that this growth underscores sports as the primary application for prediction markets, accounting for nearly half of all trading activities on these platforms.
The report also builds on Macquarie's previous projection that the 2026 FIFA World Cup could generate over $50 billion in global betting, making it the largest betting event ever, excluding prediction market activities.
Analysts attribute the record trading volumes in June largely to the World Cup, highlighting the increasing mainstream acceptance of prediction markets in sports betting.
Additionally, Macquarie noted the partnership between ADI Predictstreet, FIFA’s official prediction market partner, and Kalshi. The analysts suggested that this collaboration likely reflects ADI's need for liquidity rather than Kalshi's marketing ambitions.
Despite acquiring valuable FIFA rights, ADI appears to struggle with building a user base and liquidity to fully capitalize on this asset, as noted in the report.
Recent reports indicate that ADI Predictstreet processed approximately 126,000 trades in its first 18 days, illustrating the difficulties in establishing liquidity even with a prominent partnership.
In comparison, World Cup Winner markets on Kalshi and Polymarket generated around $1 billion and $4 billion in trading volume, respectively.
Macquarie pointed out that strategic partnerships and new product launches are increasingly bolstering the industry's foundational infrastructure. The report highlighted collaborations such as Polymarket's partnerships with Liga MX and Genius Sports, along with DraftKings' launch of its own prediction market exchange, DKeX.
According to Macquarie, DKeX signifies a pivotal step towards merging sportsbooks with prediction markets. The analysts noted that DraftKings is beginning to view prediction markets as a long-term strategic extension rather than merely a reaction to Kalshi.
Furthermore, the rapid rise of Rothera, backed by Robinhood, was also noted, as it quickly generated billions in World Cup-related trading volume and captured significant market share shortly after its launch. Analysts suggested that distribution may become as crucial as pricing and liquidity in determining the future leaders of the industry.
Lastly, reports indicate that Meta is exploring the development of a standalone prediction market application, which would initially utilize a points-based system instead of real-money trading. Macquarie stated that this move highlights the growing mainstream interest in prediction markets and may expedite widespread adoption.
However, despite the sector's rapid growth, Macquarie cautioned that the regulatory landscape remains a significant concern for the industry.