Paradigm, one of the largest investors in Kalshi, is building a professional prediction markets trading terminal. It’s the latest sign that Wall Street-grade infrastructure is arriving in a market that, until recently, has mostly been known for sports trading and election odds.
According to sources familiar with the matter, reported by Fortune, Paradigm partner Arjun Balaji has been leading the project since late 2025. The terminal is designed for professional traders and market makers, not everyday users. That distinction is key for understanding the new phase the industry is entering.
For the past year, prediction markets have been primarily a retail product, something you accessed through Robinhood or directly on Kalshi or Polymarket to bet on the Super Bowl or the next Fed rate decision. But that is shifting quickly. With professional investors, hedge funds, and major financial firms now moving in, the industry is beginning to build the tools they need. Paradigm’s terminal is the clearest sign yet that prediction markets are getting the kind of professional infrastructure that every mature financial market eventually develops.
What Paradigm is building, and why it matters
A trading terminal is akin to a professional data and trading interface, like the Bloomberg terminal that sits on every Wall Street desk. Unlike consumer trading apps, it’s a specialized tool for people who trade at scale, including real-time data, fast execution, and the ability to manage complex positions across many markets at once.
Beyond the terminal, Paradigm has also been weighing whether to establish an internal market-making desk in the prediction markets space, Fortune reported. Market makers are the firms that stand ready to buy or sell a contract at any time, providing the liquidity that makes a market function efficiently for everyone else. Professional, well-capitalized market makers are one of the key things that separates a mature financial market from a thin, volatile one.
A third source told Fortune the firm is also working with researchers on potential prediction market indices, which would bundle multiple prediction markets into a single tradeable package, much like the S&P 500 combines the stocks of 500 companies into one. An index product for prediction markets would allow investors to get broad exposure to the category without picking individual contracts, similar to how index funds work in equities. The fact that Paradigm is exploring this suggests the firm believes prediction markets are approaching the liquidity and breadth needed to make it viable.
Paradigm, a hybrid venture fund and research lab, has already begun aggregating prediction market data into a public dashboard at predictions.paradigm.xyz.
Importantly, Fortune reports that Paradigm’s development of a trading terminal is not competitive with Kalshi’s platform. Rather than trying to directly compete with Kalshi, Paradigm is building the professional layer that sits above exchanges. So we’re talking about the infrastructure layer with tools that can work across Kalshi, Polymarket US, CME Group’s prediction markets, and any other platform that emerges. The exchange is the venue, while the terminal is what professionals use to trade across venues efficiently.
The institutional shift is already underway
The stage for institutional trading has been moving into place for several months. Just last week, Kalshi secured margin trading approval and announced a research partnership with ARK Invest, two moves that together signal a market now capable of supporting institutional activity at scale.
Margin trading, in plain terms, means traders no longer have to put up the full cash value of a position before placing a trade. Previously, every trade on Kalshi operated under a fully collateralized requirement, meaning customers had to deposit the entire position value before placing an order. For a retail trader placing a small bet, no big deal. But for a hedge fund trying to build meaningful exposure across dozens of macro markets simultaneously, it’s a dealbreaker. Being able to secure $50 million in exposure while only posting $5 million, for example, is capital efficiency that turns prediction markets into real institutional trading instruments.
The ARK Invest partnership arriving in the same week underscored exactly what institutional participation looks like in practice. ARK CEO Cathie Wood said prediction markets “represent a powerful new way to quantify risk and surface forward-looking insights,” with ARK building a systematic research workflow around Kalshi data as an input to portfolio construction and risk management. Live markets are already running through that pipeline, covering economic indicators like nonfarm productivity and the US deficit-to-GDP ratio.
That followed reporting that prime brokers, the large financial firms that provide infrastructure services to hedge funds, were racing to offer clients access to prediction markets. Clear Street CEO Ed Tilly told the Futures Industry Association conference his firm expected to clear its first Kalshi trade by end of March. Marex’s global clearing head told Bloomberg: “Over the last few weeks we’ve seen very large hedge funds coming to us and saying, ‘Can you give us access to these markets?'”
Paradigm’s terminal is the next logical piece of that stack. The prime brokers provide the plumbing, the margin regime makes large positions economically viable, and the ARK partnership demonstrates the research demand. Now, the trading terminal plugs in to give professional traders the interface to put it all together.
The race to control prediction markets infrastructure
To understand what Paradigm is doing, it helps to understand the competition already underway at every other layer of the prediction markets stack.
As we detailed in a recent competitive landscape analysis, prediction markets operate across three basic levels: the exchange itself (where contracts are listed and traded), the brokerage layer (the firms that connect customers to exchanges and hold their funds), and the professional layer above including analytics, trading tools, and packaged products. Since the start of 2025, 20 new exchange filings have appeared in the CFTC registry as companies compete to operate regulated prediction market venues.
Several distinct strategies have emerged among competitors. Kalshi has pursued what might be called a distribution or hub-and-spoke model: it operates the exchange and connects to a wide network of partner platforms like Robinhood, Coinbase, Webull, PrizePicks which bring their existing users to Kalshi’s markets. Meanwhile, consumer platforms have moved to acquire their own licensed exchanges rather than remaining dependent on outside infrastructure. For example: Polymarket acquired QCX, DraftKings acquired Railbird Exchange, Underdog acquired Aristotle Exchange, and Robinhood purchased MIAXdx through a joint venture with trading firm Susquehanna International Group.
Paradigm’s moves fit none of those patterns. A trading terminal serving professional traders across exchanges, a market-making desk providing liquidity wherever it’s needed, and indices packaging multiple markets into single tradeable products are not tied to any single exchange or distribution channel. Instead, it provides infrastructure for the professional layer of the market, helping every other tier function better.
The brokerage layer often determines where trading activity ultimately flows. Because every trade passes through that relationship, firms at that layer participate in revenue regardless of which exchange ultimately lists the contract. Paradigm’s terminal targets the layer above even that: the professional participants who are increasingly the source of the volume that makes those brokerage relationships worth having.
A dedicated VC ecosystem forming around the infrastructure layer
Paradigm is not the only institutional player now focused on infrastructure rather than exchanges themselves. In March, 5c(c) Capital became the first venture capital fund dedicated solely to prediction markets. The fund has raised $35 million, backed by Polymarket CEO Shayne Coplan and Kalshi CEO Tarek Mansour, along with Marc Andreessen (via a separate fund), Millennium Management portfolio managers, and the founders of other prediction market companies including PredictIt.
The fund was founded by two former Kalshi employees and industry advocates, Adhi Rajaprabhakaran and Noah Zingler-Sternig, who previously led Kalshi’s integration with Robinhood. Rather than investing in exchanges like Kalshi or Polymarket directly, their pitch document said 5c(c) would focus on the companies that help those platforms function, including analytics tools, data providers, and the trading firms that keep markets liquid.
“At the moment, prediction markets might appear to be just about sports, but that is only the latest chapter in what we believe to be a very long story,” the founders wrote. The backing from both leading platform CEOs, fierce rivals in almost every other respect, suggests a shared recognition that infrastructure creates value for the whole ecosystem, regardless of which exchange wins the distribution war.
JPMorgan is watching
Then there is the view from traditional Wall Street. JPMorgan Chase CEO Jamie Dimon told CBS Evening News this week that his bank is considering offering prediction market services to customers. “It’s possible one day we’ll do something like that,” he said, speaking about platforms like Kalshi and Polymarket.
He was deliberate about which markets he’d enter. Dimon said JPMorgan “won’t be in sports” and “won’t be in politics,” citing strict rules around insider information. That framing leaves open a fairly specific lane: financial and economic event contracts, the kinds of markets where an institution with a serious research arm might have genuine informational edge, and where regulatory risk is more contained. It’s also, not coincidentally, almost exactly the contract category Kalshi’s ARK Invest research partnership is currently built around.
On whether prediction markets are gambling or investing, Dimon drew a clear distinction: “I think for the most part, it’s more like gambling. But there are areas where you could say, ‘No, it’s investing.’ You are deeply knowledgeable. You’re taking the other side of a bet. And you think you know better than the other person.”
That split, with retail wagering on one side and informed professional activity on the other, maps almost precisely onto the two-tier market now taking shape. The professional infrastructure Paradigm is developing isn’t meant for casual bettors. It’s for the traders Dimon is describing: the ones who believe they have an information edge and need serious tools to act on it efficiently.
What this means for retail channels
The shift toward professional infrastructure is happening as composition changes across retail distribution channels. Robinhood’s share of Kalshi’s total trading volume fell from nearly 59% in September 2025 to just 22.6% in the first 27 days of March 2026, InGame reported, even as Kalshi’s overall volume overall volume for that period approached $12 billion, the highest monthly pace on record.
That decline is partly a fee story. Robinhood charges a flat one-cent fee on every contract on top of Kalshi’s own fees, making trades on the platform consistently more expensive than going directly to Kalshi. That gap grows more significant as the volume mix shifts toward institutional and direct-access traders. Robinhood processed $2.6 billion in event contracts during the first 27 days of March, generating an estimated $26 million in fees at that flat rate, per the company’s March investor data release.
Robinhood’s own exchange, Rothera, built through its joint venture with Susquehanna International Group, changes the picture going forward. Operating its own exchange eliminates the Kalshi pass-through fee and lets Robinhood control what contracts it lists, potentially making the platform more competitive. Rothera submitted what it labeled a “FINAL” version of its rulebook in February, suggesting a launch may be imminent, InGame reported.
When that happens, Robinhood’s economics improve substantially, and the company’s 27 million funded customers remain a meaningful distribution base for any exchange it operates. But the era in which Robinhood functioned as the primary gateway to prediction markets has passed. As we noted in our Q4 earnings analysis, prediction markets were already shifting from a Robinhood-dependent product to something broader and more structurally embedded across the industry.
Institutional transformation is underway
What connects all of these developments is a single underlying shift: Prediction markets are no longer primarily a consumer product trying to find distribution. They are becoming a layered financial market, with distinct retail and professional tiers and an increasingly sophisticated infrastructure ecosystem serving both.
Every major financial market has gone through this transition. Stocks, bonds, and options all began as relatively simple instruments and developed, over time, into layered markets with specialized tools and participants at every level. The professional trading terminal makes exchanges more valuable by making sophisticated participation more efficient. That is the bet Paradigm is making on prediction markets now.
Kalshi has raised at least $1 billion in a new financing round at a $22 billion valuation, with recent reporting that Polymarket is in talks to raise at a roughly $20 billion valuation. At combined valuations approaching $42 billion, the two leading platforms now represent a market large enough to sustain exactly the kind of professional ecosystem being assembled around them. Given the volume, capital, and institutional interest all pointing in the same direction, that transition is not a future event. It’s already in progress.
