NYSE owner takes $2 billion stake in Polymarket as prediction markets heat up

By Ateev Bhandari (Reuters) -Intercontinental Exchange said on Tuesday it would invest up to $2 billion in Polymarket, marking the New York Stock Exchange owner's expansion into event-driven markets as the once-nascent asset class gains widespread popularity. Prediction markets, where users wager on outcomes across sports, entertainment, politics and the economy, including bets on when the U.S. government shutdown will end and the least streamed song on Taylor Swift's latest album, have seen a surge in institutional interest since the presidential election last year. ICE's investment, which valued Polymarket at $8 billion pre-money, marks a vote of confidence for the world's largest prediction market, as it prepares to re-enter the U.S. more than three years after restricting American users. The company secured an approval from the U.S. Commodity Futures Trading Commission last month to re-launch in the country, following its $112 million acquisition of QCEX, a CFTC-licensed derivatives exchange and clearinghouse. Regulators under President Donald Trump have eased market oversight, with focus on nascent sectors such as event contracts and crypto, which has frequently seen ventures from entities connected to him and his family. Polymarket had secured an undisclosed investment from 1789 Capital in August, a venture capital firm backed by Donald Trump Jr. Earlier this year, Reuters had reported citing a source that Polymarket was close to securing a valuation of more than $1 billion. REAL PRIZE As part of the latest deal, ICE will use Polymarket's event-driven data to provide sentiment indicators on relevant market topics. "The real prize for ICE is not just clearing contracts but monetizing the data, selling odds as sentiment factors alongside rates and credit where every rumor pays a fee," said Michael Ashley Schulman, partner and CIO at Running Point Capital Advisors. ICE shares were up marginally in afternoon trading. The two companies also aim to collaborate on future tokenization initiatives, which blend traditional financial markets with blockchain-based assets and trading technologies. (Reporting by Ateev Bhandari in Bengaluru; Editing by Shilpi Majumdar)

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