Galaxy Digital launches OTC prediction markets desk with…

Galaxy Digital has launched an over-the-counter prediction markets trading service for institutional investors, completing its debut with a $10 million wager tied to the CLARITY Act — U.S. legislation that would establish a federal regulatory framework for digital assets — placed alongside crypto-focused hedge fund Arca. The Nasdaq-listed firm (GLXY) is positioning itself as one of the first major digital asset companies to offer institutional-scale access to event-driven contracts through a bilateral trading framework.

Why it matters

Prediction markets have historically been retail-dominated, with platforms like Kalshi and Polymarket offering limited liquidity for large institutional positions. By acting as a principal counterparty, Galaxy can warehouse risk and facilitate block-sized trades with the discretion that professional investors require. The new desk initially covers non-sports contracts on Kalshi and Polymarket, with plans to expand, and lets clients pair prediction market positions with hedges across equities and commodities — effectively turning event-driven bets into integrated macro strategies. Arca's CIO Jeff Dorman noted that existing platforms made it structurally difficult for large funds to hedge Washington regulatory exposure at scale; Galaxy's desk solves exactly that problem.

Market impact

Galaxy shares slipped 6% Tuesday in line with broader crypto equity weakness, so the launch hasn't yet moved the stock. The longer-term read is more significant: if Galaxy succeeds in deepening liquidity and attracting hedge funds and family offices, prediction market prices on regulatory outcomes — including crypto legislation — could become sharper macro signals. The CLARITY Act trade is itself a live indicator of institutional conviction on U.S.