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24 June 2026

Trading On Tomorrow: The Economics And Rise Of Prediction Markets Toward A New Asset Class

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Prediction markets have rapidly evolved from niche forecasting tools into a burgeoning asset class, attracting significant interest from investors, exchanges, and regulators alike.
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In recent years, prediction markets have surged in popularity, attracting growing attention from investors, exchanges, regulators, and policymakers. In their article “Trading on Tomorrow: The Economics and Rise of Prediction Markets Toward a New Asset Class,” Senior Consultant Jianghao Liu and Katten Partners Carl E. Kennedy and Daniel J. Davis and Associate Alexander C. Kim examine the rapid rise of prediction markets as an emerging category of tradable event-risk instruments.

The authors explore how prediction markets facilitate forecasting, information aggregation, price discovery, and risk transfer, while highlighting their expanding applications across industries and the development of new financial products tied to event contracts. They also discuss the legal and regulatory considerations accompanying this growth, including risk management implications for publicly traded companies and evolving compliance expectations for market participants. 

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The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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