Bernstein forecasts $10 trillion prediction-market volume by 2035

Bernstein, led by analyst Gautam Chhugani, forecasts that prediction markets will handle $10 trillion in annual trading volume by 2035. That is roughly 24 times the $410 billion Bernstein expects the market to process in 2026 and 10 times its earlier forecast for 2030. The analysts said in a note to clients on Tuesday that volumes could compound at roughly 70% a year through 2035. Industry-wide trading grew from about $50 billion in 2025 to roughly $300 billion in the first eight months of 2026. Sports accounted for 61% of trading volume in 2025, but Bernstein expects that share to fall to 38% by 2035. Contracts tied to crypto, stocks and commodities, which Bernstein groups as financial assets, are expected to rise from 12% to 49% of the market and become the largest category for the first time. Bernstein expects new products such as KPI markets, which let users trade a single corporate metric such as production, deliveries or subscriber growth instead of a stock price. The analysts also said perpetual futures are expanding from crypto to commodities and single-stock contracts. Prediction markets offer yes-or-no contracts on whether an event will occur, and each contract settles at $1 if it occurs and $0 if it does not. Crypto's share of Kalshi's volume rose from under 5% in January to about 20% in August. Commodity trading on Kalshi increased from less than $2 million in all of 2025 to roughly $590 million so far in 2026, including $410 million in August alone. Kalshi controls about 60% of industry volume, up from 35% a year earlier. In April, Bernstein had forecast that prediction markets would reach $1 trillion by 2030, up from $51 billion in 2025. At that time, the analysts said growth would come less from larger sports bets and more from institutional participation. They also said greater federal regulatory clarity, blockchain-based tokenization and integration with crypto markets could expand the addressable market and support global liquidity, long-tail event creation and institutional participation. Bernstein estimates that crypto, stocks and commodities represent a $700 trillion pool of possible bets today and could represent a $900 trillion pool by 2035. The analysts said capturing 0.5% of that pool would produce $4.7 trillion in annual volume from financial contracts alone, excluding sports wagers. Robinhood CEO Vlad Tenev said the company is already seeing categories such as crypto take a disproportionate share and expects sports to become a minority of prediction-market activity within a few years. Robinhood's event-contract business reported a tenfold increase in revenue to $156 million in the second quarter of 2026. Bernstein separately projected that prediction markets would become a meaningful source of revenue for Robinhood in 2026 as crypto categories gain a larger share of trading. Bernstein said firm regulatory clarity for U.S. sports prediction markets is unlikely before 2027 or 2028 because courts have issued conflicting rulings on whether the contracts are federally regulated derivatives or state-regulated gambling. The analysts expect the industry to end 2026 at $410 billion in volume and now treat that figure as a floor rather than a ceiling.