Key Takeaways
- • Galaxy Digital launches dedicated OTC derivatives desk for prediction markets, positioning itself as a market maker for event-linked derivatives in the rapidly growing prediction market sector alongside platforms like Polymarket and Kalshi.
- • Institutional adoption of crypto derivatives accelerates, building on Galaxy's earlier milestone of executing its first OTC options trade with Goldman Sachs in March 2026, marking major bank entry into crypto derivatives trading.
- • Galaxy offers comprehensive OTC solutions including physically and cash-settled derivatives, deliverable and non-deliverable options, and bespoke structured products with 24/7 market access and competitive pricing through its network of exchanges and liquidity providers.
- • Market infrastructure strengthens for prediction markets, with Galaxy's involvement alongside liquidity providers like Susquehanna Crypto (as seen in BitGo's parallel offering) improving pricing efficiency and trading experience for institutional participants in event-linked derivatives.
- • Regulatory environment supports institutional growth, as prediction market platforms receive CFTC approval for U.S. operations, enabling major financial institutions and crypto merchant banks to offer derivatives products similar to traditional futures markets but tied to future events.
Summary
Galaxy Digital has established an over-the-counter derivatives desk dedicated to prediction markets, capitalizing on the sector's institutional expansion. This move positions the New York-based digital assets firm as a market maker for event-linked derivatives, with reported discussions to provide liquidity for major prediction market platforms including Polymarket and Kalshi. The desk builds on Galaxy's existing OTC infrastructure and recent success in executing crypto derivatives trades with traditional financial institutions.
The establishment of this desk represents a continuation of Galaxy's institutional push into crypto derivatives trading. In March 2026, Galaxy executed its first over-the-counter options trade, marking a tangible step toward mainstream institutional adoption. This was followed by a landmark transaction in which Goldman Sachs conducted an OTC crypto derivatives trade with Galaxy—a non-deliverable bitcoin-linked option—signaling major bank willingness to engage in institutional crypto derivatives markets through established merchant banks.
Galaxy's prediction markets desk offers institutional-grade OTC derivatives infrastructure with multiple structural options. The offering includes physically and cash-settled instruments, deliverable and non-deliverable contracts, and custom bespoke solutions. The firm provides 24/7 market access to OTC pricing across linear and non-linear derivatives, leveraging its network of exchanges and market makers to deliver competitive pricing. Galaxy's publicly listed status, stringent governance, sophisticated compliance oversight, and strong balance sheet position it as a trusted counterparty capable of warehousing risk at scale—a critical function for institutional participants managing large exposures in emerging markets.
The prediction markets sector has received regulatory validation, with digital asset exchanges securing CFTC approval for U.S. prediction market operations. These markets function similarly to futures contracts but reference future events rather than physical or financial assets. The presence of institutional market makers like Galaxy improves liquidity depth, pricing efficiency, and trading experience for sophisticated participants. Parallel infrastructure development—including BitGo's OTC desk offering event-linked derivatives with Susquehanna Crypto providing back-end liquidity—demonstrates accelerating institutional adoption across the prediction market ecosystem and points to sustained demand for professional market-making services in this segment.
The establishment of this desk represents a continuation of Galaxy's institutional push into crypto derivatives trading. In March 2026, Galaxy executed its first over-the-counter options trade, marking a tangible step toward mainstream institutional adoption. This was followed by a landmark transaction in which Goldman Sachs conducted an OTC crypto derivatives trade with Galaxy—a non-deliverable bitcoin-linked option—signaling major bank willingness to engage in institutional crypto derivatives markets through established merchant banks.
Galaxy's prediction markets desk offers institutional-grade OTC derivatives infrastructure with multiple structural options. The offering includes physically and cash-settled instruments, deliverable and non-deliverable contracts, and custom bespoke solutions. The firm provides 24/7 market access to OTC pricing across linear and non-linear derivatives, leveraging its network of exchanges and market makers to deliver competitive pricing. Galaxy's publicly listed status, stringent governance, sophisticated compliance oversight, and strong balance sheet position it as a trusted counterparty capable of warehousing risk at scale—a critical function for institutional participants managing large exposures in emerging markets.
The prediction markets sector has received regulatory validation, with digital asset exchanges securing CFTC approval for U.S. prediction market operations. These markets function similarly to futures contracts but reference future events rather than physical or financial assets. The presence of institutional market makers like Galaxy improves liquidity depth, pricing efficiency, and trading experience for sophisticated participants. Parallel infrastructure development—including BitGo's OTC desk offering event-linked derivatives with Susquehanna Crypto providing back-end liquidity—demonstrates accelerating institutional adoption across the prediction market ecosystem and points to sustained demand for professional market-making services in this segment.
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