Overview
- Galaxy launched the institutional over‑the‑counter prediction‑markets desk on Tuesday and completed a $10 million inaugural event swap with crypto hedge fund Arca tied to the CLARITY Act.
- Under the Arca swap Arca pays Galaxy if the CLARITY Act becomes law before 2027 and Galaxy pays Arca if it does not, creating a bilateral hedge on the bill’s outcome.
- The desk initially covers non‑sports contracts listed on Kalshi and Polymarket and allows Galaxy to combine event positions with hedges in equities and commodities to build multi‑asset strategies.
- Galaxy is offering the service only to institutional clients and will screen participation by jurisdiction to address legal and regulatory requirements while acting as principal to hold and manage block trade risk.
- The move follows rapid growth in public prediction markets — combined monthly turnover on Kalshi and Polymarket rose sharply from late 2025 to early 2026 — and could deepen liquidity for large investors even as regulatory uncertainty remains a key risk.