2026 Major Trends, with the second being forecasts

Forecasts indicate that the prediction market will continue to innovate (though only some players will break through)

In this cycle, the prediction market is undoubtedly one of the most outstanding application categories. The total trading volume on the entire chain of prediction markets has repeatedly hit new highs, with weekly trading volumes exceeding 2 billion USD, clearly indicating that this category has taken a key step towards becoming a consumer product.

Amid this heat, a large number of new projects attempting to challenge Polymarket and Kalshi have emerged. However, identifying 'true innovation' amidst the noise is key to determining which projects are worth focusing on in 2026.

From a market structure perspective, I am most concerned with solutions that can reduce spreads and enhance open interest. Although market creation remains licensed and selective, the liquidity in prediction markets is still relatively thin for both market makers and traders. The best paths include optimizing routing systems, introducing different liquidity models, and improving collateral efficiency based on products like lending.

Categorical trading volume is a key factor influencing platform outcomes. For example, over 90% of Kalshi's trading volume in November came from the sports market, indicating that certain platforms are naturally better suited to compete for specific liquidity. In contrast, Polymarket's trading volumes in crypto and political markets are 5–10 times higher than those of Kalshi.

Of course, on-chain prediction markets still have a long way to go before achieving true 'mass adoption.' For instance, in just the Super Bowl day of 2025, there was an over-the-counter betting volume of 23 billion USD, which is more than ten times the total daily trading volume of all current on-chain markets.