Prediction markets could hit a trillion dollars in trading volume by the end of this decade, new report says

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Prediction markets could reach a trillion dollars in annual trading volume by the end of this decade, according to a new report from Eilers & Krejcik, a research firm that specializes in sports and interactive gaming sectors.

“Numerous factors, most notably legal and regulatory challenges, could delay or derail the growth of prediction markets,” Eilers & Krejcik partner emeritus and strategic advisor Chris Grove told CNBC. “But the fundamental elements of consumer demand and an array of diverse brands looking to meet that demand are clearly in place.”

That growth will be fueled by sports, which E&K predicts will represent 44% of the long-run volume for prediction markets.

The booming predictions space allows users to wager on events in culture, politics and sports, among other markets. A rise in popularity for platforms like Polymarket and Kalshi has inspired traditional sportsbooks to launch their own predictions platforms.