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Nasdaq, one of the nation’s largest stock exchanges, has filed paperwork to launch its own prediction market products. The move marks the latest traditional finance entity to enter the rapidly expanding space; it follows a $2 billion investment by Intercontinental Exchange, owner of the New York Stock Exchange, into Polymarket late last year.
The regulatory turf war over prediction markets
While existing prediction markets typically fall under the purview of the Commodity Futures Trading Commission, Nasdaq’s status as an established stock trading venue required it to file with the Securities and Exchange Commission. The filing highlights a growing “gray area” and a jurisdictional turf war between the two regulatory agencies.
CFTC Chair Michael Selig and SEC Chair Paul Atkins, both appointees of the Trump administration, hold diverging viewpoints on which agency should oversee the sector.
Selig has maintained a combative posture regarding the CFTC’s jurisdiction, slamming what he described as an “onslaught of lawsuits” directed at prediction platforms. Selig argues that platforms such as Kalshi and Polymarket exist firmly under CFTC oversight.
Atkins, however, contends the industry falls under the SEC’s authority. During recent congressional testimony, Atkins noted the complexity of the shift.
“Prediction markets are exactly one thing where there’s overlapping jurisdiction potentially,” Atkins said in a news post by Blockhead. “That is a huge issue we’re focused on.”
Nasdaq products would offer ‘yes or no’ markets
Mirroring the model used by industry leaders, Nasdaq’s SEC filing states the exchange would offer “yes or no” markets on event outcomes. The contracts, referred to as “Outcome Related Options,” would be valued between 1 cent and $1.
Nasdaq is seeking SEC approval to allow traders to purchase these event-based options on the Nasdaq 100 Index and the Nasdaq Micro Index. Such trades typically occur off-exchange, making this a significant move toward centralizing the products on a major board.
The development is another signal that traditional financial outlets recognize the revenue potential of prediction markets.
The Nasdaq 100 tracks the performance of 100 of the largest nonfinancial companies listed on the exchange, including tech giants Intel, Nvidia, and Apple. A filing to launch prediction markets on such a high-profile index represents a major shift in a financial landscape increasingly defined by event-based wagering.
