Wintermute, one of the largest and most prominent market makers in the crypto industry, confirmed on Friday that it has been providing liquidity on prediction markets.
A person familiar with the matter told Decrypt that the venues include Polymarket and Kalshi, signaling that capital flows dynamically between both platforms in a way that’s designed to make it easier for traders to buy and sell positions without causing large price swings.
In a statement, Wintermute’s Head of OTC Trading Jake Ostrovskis described the liquidity profile for prediction markets as “early-stage,” a quality that contrasts with growing demand.
“For these markets to become a reliable real-time source of probability estimates, they need sustained two-sided liquidity,” he said. “That depth tightens spreads, supports larger trade sizes, and in turn improves the signal embedded in market prices.”
Instead of betting on the given outcome of an event, liquidity providers aim to facilitate trades, profiting namely from a “spread,” or the difference in costs tied to buy and sell orders. Within the context of a casino, they could be viewed as card dealers as opposed to gamblers.
Wintermute said its participation in the prediction-market space moves the platforms from “a nice forecasting tool into a broader venue for trading event risk,” adding that providing liquidity helps improve the reliability of probabilities shown on Polymarket and Kalshi.
