Bernstein: 'Prediction Markets Will Sweep Up Institutional Funds After Bitcoin'

▲ Prediction Market/ChatGPT Generated Image

Global investment bank Bernstein has identified prediction markets as a new core driver of the blockchain ecosystem, predicting a massive influx of institutional capital.

According to virtual asset media outlet Cointelegraph on May 4 (local time), Bernstein stated in a recent report that prediction markets like Polymarket are evolving beyond mere gambling into institutional-grade financial products. The report noted that the value of real-time data provided by prediction markets surpasses traditional surveys and analytical models, and large financial institutions are showing interest in large-scale block deals based on this.

Prediction markets have the characteristic of reflecting public sentiment in prices more quickly and accurately than votes or opinion polls. Bernstein analyzed that the speed of this data offers a strong appeal to institutional investors as a hedging tool or an information acquisition instrument. In particular, the vast trading volume generated in the process of predicting political events or macroeconomic indicators serves as an example proving the practical utility of the virtual asset ecosystem.

Institutions are showing signs of entering prediction markets through large-scale transactions such as block deals rather than individual small-scale trades. This means that as the liquidity of prediction markets matures, large asset managers can use prediction products to manage portfolio risks. Bernstein predicted that this influx of institutional funds would elevate prediction markets into a new investment area, following major assets like Bitcoin (BTC) and Ethereum (ETH).

In conjunction with major political events in 2026, the trading volume of prediction markets is growing exponentially. The report evaluated that prediction markets are overcoming the limitations of existing over-the-counter markets by combining the transparency of blockchain and the efficiency of smart contracts. As technological completeness increases, prediction markets are expected to transform from simple prediction tools into sophisticated financial platforms integrated with derivatives.

The growth of prediction markets indicates that the virtual asset ecosystem has entered a phase of generating real economic value. Bernstein expects prediction markets to become an essential component of institutional investors' portfolios, serving as a bridge to expand the overall virtual asset market. The entry of institutional finance is expected to enhance the credibility of prediction markets and drive qualitative market growth.

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