Bernstein has raised its long-term forecast for prediction markets, predicting annual trading volumes could reach $10 trillion by 2035, compared to current expectations of $410 billion per year. The projection reflects anticipated growth in financial contracts tied to equities, commodities, and cryptocurrencies.
Financial Assets Expected to Overtake Sports
Bernstein forecasts approximately 70% annual volume growth from 2025 through 2035. The firm predicts a significant shift in market composition, with financial contracts representing roughly 12% of total volume in 2025 growing to 49% by 2035. In contrast, sports betting is expected to decline from 61% to 38% of total volume during the same period.
The growth is being driven by emerging financial products, including KPI markets where traders can wager on individual company metrics such as production or deliveries, as well as perpetual futures that are expanding from cryptocurrency into commodities and individual stocks.
Current Market Dynamics
Industry volume has grown from approximately $50 billion in 2025 to roughly $300 billion through August 2026, according to Bernstein's data. This expansion has been fueled by short-term crypto and commodities contracts, including 15-minute Bitcoin contracts.
Kalshi has emerged as the leading prediction market platform, accounting for nearly 60% of industry volume by August compared to 35% in 2025. Crypto-related trading on Kalshi surged from less than 5% in January to nearly 20% by August, while commodities trading grew from below $2 million in 2025 to approximately $590 million year-to-date.
On Polymarket, sports contracts represent around 52% of total volume, while political markets have declined to 22% from 32% year-over-year.
Market Size and Regulatory Considerations
Bernstein's $10 trillion projection is based on an estimated addressable market for financial asset contracts of $700 trillion in 2025, growing to $900 trillion by 2035. If prediction markets capture just 0.5% of this market by 2035, the firm estimates this would generate approximately $4.7 trillion in annual volumes from financial contracts alone.
Bernstein notes that regulatory approval for U.S. sports prediction markets is unlikely before 2027-2028, citing ongoing court disputes over whether these contracts should be classified as derivatives under federal law or as gaming under state regulations.
Bernstein's forecast represents a significant upward revision from its April 2026 projection, which predicted volumes of $1 trillion by 2030.
