Key Facts

• Cboe Global Markets has launched Cboe Predicts, a prediction market platform offering binary contracts tied to the S&P 500 index, with contracts available through Interactive Brokers and expected to launch at Charles Schwab and other retail brokerage platforms in the coming months.
• The contracts allow traders to take "yes" or "no" positions on whether the S&P 500 will close above or below a specified price level, and are security options that will trade within the same regulatory framework as US-listed options.
• JJ Kinahan, head of retail expansion and alternative investment products at Cboe, stated that customers are showing more demand for shorter-dated, outcome-based trading opportunities, which led to the debut of the prediction market offering.
• The launch of Cboe Predicts comes as investor interest in outcome-based contracts grows, with contracts tied to the S&P 500's daily closing price already available on prediction market platforms such as Polymarket and Kalshi.
• Prediction market platforms have drawn increased regulatory scrutiny over political betting and sports-related event contracts, with Kentucky being the latest state to sue five prediction market platforms, including Kalshi and Polymarket, for allegedly operating unlicensed and illegal sports betting and gambling platforms.