Goldman Sachs CEO David Solomon revealed on Thursday that the prominent Wall Street investment bank is delving into opportunities within prediction markets. This move indicates a rising institutional interest in a segment of finance attracting more attention from traders.
In a session for Goldman's fourth-quarter earnings, Solomon noted, “The prediction markets are also super interesting.” He further elaborated on his recent interactions with major prediction market companies and their leaders. “I personally met with the two big prediction companies and their leadership in the last two weeks and spent a couple of hours with each to learn more about that. We have a team of people here that are spending time with them and are looking at it,” Solomon stated, citing a FactSet transcript.
Platforms like Kalshi and Polymarket offer investors the chance to trade contracts connected to the outcomes of global events such as elections and policy decisions. Goldman's interest emerges as these markets gain traction amid discussions about market transparency and regulatory constraints.
Notably, some platforms operate under the supervision of the Commodity Futures Trading Commission (CFTC), making them similar to conventional financial products. “When you think about some of these activities, particularly when you look at some of the ones that are CFTC regulated, they look like derivative contract activities,” said Solomon, who has been at the helm of Goldman since 2018. “So I can certainly see opportunities where these cross into our business.”
However, Solomon expressed caution regarding the pace of Wall Street's adoption of prediction markets. “I think there's a lot of reason to be excited and interested in these things,” he mentioned. “But the pace of change might not be as quick and as immediate as some of the pundits are talking about. But I think they're important, real. And we're spending a lot of time.”
Disclosure: CNBC and Kalshi have a commercial relationship.