Prediction markets balled out while the rest of Q2 took an L 📉🏆

Prediction markets posted their strongest quarter on record while cryptocurrency trading slumped across spot, derivatives and stablecoins, according to CoinGecko's Crypto Industry Report released Thursday. Notional volume across prediction markets reached $113.8 billion in the second quarter of 2026, even as total crypto market capitalization fell 12.6% to $2.1 trillion. The sector peaked in June with $50.7 billion in monthly notional volume, up 91.9% from the average of the previous five months, coinciding with the start of the FIFA World Cup.

Spot trading volume across the top 10 centralized exchanges fell to $1.95 trillion in the second quarter, a 27.9% drop from $2.7 trillion in the first quarter, according to CoinGecko. Centralized exchange perpetual futures volume declined 10% to $12.7 trillion, and the stablecoin market slipped 1.6% to $305.1 billion. Decentralized exchange activity also weakened, with the top 10 spot DEXs processing $408.9 billion, down from $556.4 billion in the prior quarter, while Uniswap retained a leading 41.2% market share despite a 21.4% volume decline to $168.5 billion.

Binance extended its dominance among centralized exchanges with a 38.7% market share in the second quarter, while MEXC recorded the largest decline among spot CEXs, with volume more than halving from $275.2 billion in the first quarter to $121.2 billion in the second. The quarter's weakness also included a record month for decentralized finance hacks in April.

In prediction markets, Kalshi held the lead with a 58.9% market share, while Polymarket's share fell from 35.8% to 30.2% over the quarter. Robinhood-backed Rothera Markets climbed to fourth place, and Polymarket's World Cup winner market attracted more than $3.3 billion in trading volume, with 2028 US presidential election contracts ranking among the platform's largest markets, according to Polymarketscan data. Sports and politics emerged as the sector's largest volume drivers.

The growth has drawn regulatory attention, with US regulators and states clashing over whether prediction markets should be classified as financial markets or gambling platforms and lawsuits involving platforms such as Kalshi escalating in 2026. Authorities in other jurisdictions have also moved to restrict prediction markets, citing concerns including gambling rules, market integrity and potential insider trading risks.