BitGo Launches $100,000 Minimum Trades for Institutional Prediction Markets
Digital asset custodian BitGo and trading firm Susquehanna Crypto have partnered to offer institutional clients over-the-counter (OTC) access to prediction markets. The new service targets hedge funds, family offices, and other large investors, allowing them to trade contracts tied to real-world events with a minimum trade size of $100,000. Liquidity will be provided by Susquehanna, a major quantitative trading firm.
This structure allows institutions to use their existing cryptocurrency holdings, such as Bitcoin or stablecoins, as collateral directly from BitGo's custody platform. This eliminates the need to convert digital assets into cash, a significant operational hurdle on retail-focused platforms. By creating a workflow that uses standard derivatives-style documentation for bilateral trades, the offering aims to bridge the infrastructure gap that has largely prevented institutional capital from entering the prediction market space.
Firms Target $45B Market Despite Intensifying Regulatory Scrutiny
The move comes as prediction markets show substantial growth, with trading volumes reaching between $40 billion and $45 billion in 2025. While institutional interest in using these markets for hedging and price discovery is building, the sector faces a complex and challenging regulatory environment in the United States. This partnership represents a calculated bet that a compliant, institutionally-focused model can succeed.
Regulatory pressure is mounting at the state level. On March 20, a Nevada court issued a temporary ban on the platform Kalshi, and Arizona authorities have filed criminal charges against entities linked to the company. However, a federal judge in Tennessee blocked a similar state-level action in February, ruling that such event contracts fall under the jurisdiction of the Commodity Futures Trading Commission (CFTC). The CFTC itself is formally evaluating how to regulate the asset class, signaling a potential path for federal oversight that could bring clarity to the market.
Derivatives-Style Framework Aims for Institutional Compliance
The BitGo and Susquehanna offering is structured to appeal to professional trading firms by mirroring established practices in traditional finance. The combination of integrated custody, bilateral OTC execution, and formal collateral management provides a compliant wrapper that has been absent from the market. This approach is designed to function within existing compliance frameworks, distinguishing it from offshore retail platforms.
BitGo’s strategic positioning is further bolstered by its recent conversion of its state trust bank charter into a national charter, strengthening its regulatory standing across the U.S. This new service, alongside competitor moves like Kalshi's partnership with Tradeweb, highlights a broader industry race to build institutional-grade infrastructure for event-based contracts, anticipating growing demand from sophisticated investors for regulated hedging and trading instruments.
