Jump Trading to serve as Polymarket and Kalshi market maker in exchange for stake: Bloomberg

Jump Trading, one of the world’s most prominent and secretive high-frequency trading (HFT) firms, is making a significant strategic entry into the rapidly growing event futures and prediction market sector. According to a recent Bloomberg report, Jump will serve as a dedicated market maker for both Polymarket, a decentralized prediction market platform, and Kalshi, a regulated event futures exchange.

The arrangement is structured as a strategic partnership where Jump Trading will receive an equity stake in both companies in exchange for providing essential liquidity. This move is viewed as a major endorsement for the nascent prediction market industry, suggesting that institutional HFT giants are recognizing these platforms as viable, professional financial venues.

As a market maker, Jump Trading’s primary function will be to continuously quote bid and ask prices across a multitude of event contracts on both exchanges. This activity is critical for reducing price volatility, narrowing the spread between buyers and sellers, and ensuring efficient execution for users. Increased liquidity is often the most vital factor in transitioning emerging exchanges from niche platforms to mainstream trading arenas.

Jump’s decision to partner simultaneously with both Polymarket and Kalshi highlights its dual strategy for engaging the market. Polymarket operates primarily in the Web3 and decentralized finance (DeFi) space, dealing with popular contracts ranging from geopolitical events to crypto price movements. Kalshi, conversely, is regulated by the Commodity Futures Trading Commission (CFTC) and aims to attract institutional investors to trade contracts based on economic, political, or weather events.

For Polymarket and Kalshi, securing a partner of Jump Trading’s caliber lends significant institutional legitimacy and ensures professional trading infrastructure. For Jump, the deals offer early access and a profitable, equity-linked position in markets that many analysts believe are poised for exponential growth as regulatory clarity improves.

Source: Jump Trading to serve as Polymarket and Kalshi market maker in exchange for stake: Bloomberg