Schwab's $12T Juggernaut Crashes the Prediction Market Party, Polymarket and Kalshi on Notice 📊

Charles Schwab, a brokerage firm overseeing up to $12 trillion in customer assets, is moving into the prediction markets space through a partnership with derivatives exchange Cboe Global Markets. The collaboration, reported by the Wall Street Journal, will introduce all-or-nothing options contracts that let clients place wagers on the performance of the S&P 500, positioning the TradFi heavyweight alongside the CME and Interactive Brokers, both of which have already entered the market.

The upcoming product differs structurally from the offerings of crypto-native prediction platforms Polymarket and Kalshi. Schwab's contracts will be based on options rather than futures. Interactive Brokers previously rolled out its own prediction markets platform with integrations for Kalshi, CME Group, and ForecastEx.

Schwab plans to release the contracts to customers in the coming months, according to the WSJ report, which cited people familiar with the matter. The firm is also preparing an options offering designed to allow traders to earn a partial payout if they are mostly right on the S&P 500's direction, a feature designed to attract retail engagement with a lower-risk structure.

The launch marks a notable expansion of prediction market infrastructure by one of the largest U.S. brokerages by assets under custody, and signals continued convergence between traditional brokerage services and event-based financial products.