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AI agents and prop firms expand prediction market liquidity ahead of Fed
Kalshi and Polymarket combined reached a June peak of $13.7 billion in monthly volume, with July already above $11 billion.
CryptoSlate reports that prediction market liquidity is shifting ahead of the Federal Reserve meeting on July 28 and 29, as traders look to price the outcome of the next rate decision through contracts that settle on what the central bank announces.
The outlet says Reuters polled 104 economists on July 21 and found all expected the Fed to hold at 3.50% to 3.75%, with Kalshi’s July contract putting 87% on that range and about $29.7 million in volume displayed, leaving pricing for the remaining 13% to be supplied by market counterparties.
CryptoSlate adds that those counterparties increasingly include market makers, quantitative firms, funded-trading shops, and AI agents that monitor related contracts and update probabilities around the clock. It says institutions are also testing event contracts, while brokers add liquidity providers, and some funded-trading firms treat resolved contracts as a way to identify traders, human or algorithmic, who can price uncertainty better than the crowd.
The report also cites scale in the prediction market segment, saying combined monthly volume across Kalshi and Polymarket peaked at $13.7 billion in June, with July already over $11 billion. It further notes that Kalshi said its annualized volume has more than tripled over six months to $178 billion, institutional volume climbed 800%, and it completed its first customized block trade.