Prediction markets are attracting significant institutional interest as major trading firms enter the rapidly growing sector. Susquehanna International Group, a prominent options-trading firm, is actively recruiting senior traders to expand into prediction markets, where participants bet on outcomes ranging from Federal Reserve rate decisions to weather events. According to the company’s careers page, the firm is seeking multiple candidates to design real-time models for event-driven outcomes.
The job posting indicates that successful applicants will need strong trading intuition, statistical expertise, and programming skills to build models that drive profitable decision-making. Prediction markets gained mainstream attention during the 2024 election cycle, and interest has continued to expand across both retail and institutional investors. Susquehanna previously entered betting markets in 2024 when it launched a 15-person sports betting team at its Dublin office with plans for U.S. expansion.
Wall Street Embraces Prediction Markets
Susquehanna’s move reflects broader institutional adoption of prediction markets as legitimate financial instruments. Goldman Sachs CEO David Solomon recently indicated during the bank’s earnings call that the firm is exploring opportunities in the space. This signals a significant shift from viewing prediction markets as purely speculative to recognizing them as valuable tools for risk assessment and forecasting.
However, the institutional embrace extends beyond simple participation. According to Alex Taaffe, chief revenue officer at crypto market maker GSR, this represents a watershed moment for the industry. He told Business Insider that prediction markets will increasingly serve as benchmarks and data points for investors to hedge risk and express macro views alongside traditional instruments.
Regulatory Validation and Market Maturation
The Federal Reserve added credibility to prediction markets this week when it released a report stating that platform Kalshi can be useful for forecasting economic events. This endorsement from a major regulatory institution suggests prediction markets are gaining acceptance as legitimate financial tools. Additionally, the involvement of sophisticated trading firms brings technical expertise and liquidity to platforms that previously relied primarily on retail participation.
Marek Sandrik, partner at blockchain-focused venture capital firm RockawayX, explained that Susquehanna’s expansion demonstrates the maturation of prediction markets. The sector is evolving from highly speculative vehicles into real-time sentiment tools that help investors gauge key event outcomes. Meanwhile, established financial firms bring resources and credibility that could accelerate mainstream adoption.
Challenges Facing Institutional Prediction Markets
Despite growing institutional interest, prediction markets still face significant hurdles. According to Sandrik, current platforms struggle with weak liquidity and unclear regulatory frameworks that can hinder growth. These issues have prevented prediction markets from achieving the scale and reliability necessary for widespread institutional use.
In contrast, institutional participation could address these exact challenges. Larger trading firms bring substantial capital that improves market liquidity, making it easier for participants to enter and exit positions. Furthermore, their involvement often encourages regulatory clarity as authorities develop frameworks to govern institutional activity in emerging markets.
Industry Experts Anticipate Further Growth
Market observers expect more traditional financial institutions to follow Susquehanna’s lead. Taaffe predicts further adoption by major Wall Street players as prediction markets demonstrate their utility across asset classes. The integration of prediction markets with existing financial instruments could create new hedging strategies and risk management tools for institutional portfolios.
Sandrik noted that institutional participation should contribute to better user experiences and accelerated growth industry-wide. Professional market makers can provide tighter spreads and more consistent pricing, benefiting both retail and institutional participants. Susquehanna could not be reached for comment on its specific plans or timeline for the prediction markets initiative.
The timing and scope of Susquehanna’s prediction markets expansion remain uncertain, though the active recruitment suggests the firm intends to build capabilities quickly. Industry observers will watch whether other major trading firms announce similar initiatives in coming months.
