Are crypto traders slowly moving to prediction markets?

[Questat]

This topic is quite interesting because reportedly, some crypto traders are now moving to prediction markets. One reason is that crypto sometimes takes time before the market really moves, while prediction markets always have different events going on, so traders can keep trading if they want. If they are good at analyzing those events, they can also make money there.

This makes me wonder what could happen to crypto trading volume if more active traders move to prediction markets. Maybe instead of day trading crypto, some people will just hold their coins, then use prediction markets for their short-term trading activity.

If this trend continues, do you think crypto trading volume could eventually be affected, or prediction markets are still too small to make that kind of impact?

Source:
https://www.wsj.com/finance/currencies/for-many-individual-traders-prediction-markets-are-hotand-crypto-is-not-bef27e3d

[Odohu]

I don't see any direct correlation between crypto trading and the prediction market and if you ask me, crypto trading should be easier than the prediction market. The reason is simple, trading is more organized and have a lot of literatures covering the experiences of others and this can serve as reference for people to study and sharpen there skills. This is not the same with prediction market, hence the reason I consider it riskier than trading. Therefore, prediction market is not a threat to crypto trading.

[WhoYouCantKill]

I don't see any direct correlation between crypto trading and the prediction market and if you ask me, crypto trading should be easier than the prediction market. The reason is simple, trading is more organized and have a lot of literatures covering the experiences of others and this can serve as reference for people to study and sharpen there skills. This is not the same with prediction market, hence the reason I consider it riskier than trading. Therefore, prediction market is not a threat to crypto trading.

You’re on board. I’m not much of a trader though, but I know that trading is a lot more organized than the prediction market, and even gambling. Lately, there’s been numerous reports about insider information in the prediction market, and this is making a lot of people shift their attention away from the the prediction market, because with insider information standing as a potential threat, people would no longer have that confidence in the credibility of the market as it could be easily manipulated and exploited at any time.

[Oshosondy]

I am a crypto trader, but I am also betting on prediction markets.

I think most people that will be betting on prediction markets will be crypto traders and more exchanges are now having prediction markets. But that does not mean most of the crypto traders will stop trading cryptocurrencies. I am still trading and I bet on prediction sometimes, but I use gambling sites on this forum mostly though.

I still trade than betting on prediction markets.

[Iranus]

I think prediction market will definitely pull some retail volume out of crypto.
But this is not directly equivalent to any decrease in crypto volume.

In my opinion actual competition is for traders attention and risk capital.

Many people may hodl BTC long term and use prediction market for their short term speculation. In this case, crypto trading activity will decrease. But it is not that hodler are decreasing.

[sergiorus]

Crypto users (mostly ''tourists'') have been moving onto something else all of 2025 and early 2026. You could see Crypto Twitter influencers openly moving to stock market (in 2019 some of them openly pivoted to Forex btw).

For normies who came into crypto for the memecoin mania in 2024-2025 moving onto the next hot thing aka prediction markets was a logical move. You see many of them coming back to gamble on Robinhood Chain memecoins now by the way so it's always ebbs and flows with these things. People follow the hype and the money.

[Russlenat]

That makes sense, because not all crypto traders are really doing serious analysis, some are basically gambling already. So for them, moving to prediction markets could even be more exciting because there are many different things to trade, sports, politics, weather and other events.

But those who are serious traders, already consistent and profitable in crypto, I don’t think they would easily move to a more gambling-style market, especially when manipulation and insider information can be a bigger concern there.

[freedomgo]

I think prediction market will definitely pull some retail volume out of crypto.
But this is not directly equivalent to any decrease in crypto volume.

In my opinion actual competition is for traders attention and risk capital.

Many people may hodl BTC long term and use prediction market for their short term speculation. In this case, crypto trading activity will decrease. But it is not that hodler are decreasing.

People want something that is easy and fun, and prediction markets fit that. But as they continue to grow in popularity, they are also facing more regulatory pressure, so I think their biggest challenge is how they will survive as regulators start paying more attention to them.

Trading platforms are already well regulated, while prediction markets are still dealing with a lot of legal questions. So traders who are putting in big money may still prefer regular trading platforms where they feel their funds are more secure.

With prediction markets becoming this popular, it’s expected that they will pull some volume away from crypto trading, but the real question is, can they sustain that growth long term?

[EluguHcman]

This topic is quite interesting because reportedly, some crypto traders are now moving to prediction markets. One reason is that crypto sometimes takes time before the market really moves, while prediction markets always have different events going on, so traders can keep trading if they want. If they are good at analyzing those events, they can also make money there.

So the ideology of those crypto traders that moves over to bet or trade in the prediction market is basically because out of impatient on long term price prediction? Then they can also trade short term.
Of course I don't think if that your reason is right.

Prediction market I know had only been a betting market that is gaining more attentions with traders participating to bet on the public events.
Maybe we should call it a phase of diversification trades because I can even see more traders coming to the crypto market.

[Orpichukwu]

I don’t see the movement between them; maybe crypto future traders might be picking interest in prediction markets since there is a bit of similarity, but I can’t say the same for someone who is a sport trader, in that as much as prediction markets can give money, there is also a very high chance of losing money, so I don’t even consider the audience moving from one part to the other, people who are even said to be in prediction markets. are said to be new set of crypto newbies which are not much experienced in the market.

[KiaKia]

I am a crypto trader myself but that's because I have stop loss and good tools at my disposal, I can't do the same with prediction market, I know that prediction market based on data analysis completely which is an edge over gambling.

That's if you can find a way to get accurate information I believe you will keep printing money with prediction market, but it's not just for me, and let's not compare prediction with trading, they are not the same thing.

[Sim_card]

I don't know why will a trader abandon trading and move to prediction market when there are two different things entirely. Only the the trader was a gambler that is, gambling without knowing what he's doing in the market and claim to be a trader. That's when he can move to prediction market to try his luck. Prediction market is for gamblers and not traders don't let them deceive you.

[sompitonov]

I don’t see the movement between them; maybe crypto future traders might be picking interest in prediction markets since there is a bit of similarity, but I can’t say the same for someone who is a sport trader, in that as much as prediction markets can give money, there is also a very high chance of losing money, so I don’t even consider the audience moving from one part to the other, people who are even said to be in prediction markets. are said to be new set of crypto newbies which are not much experienced in the market.

It's likely that those who tried crypto trading and were disappointed are trying other risk-related ventures, and prediction markets could be among them. Many crypto trading enthusiasts likely simply think that something new has emerged where they can make quick money, but this will continue until it becomes clear that prediction markets themselves will profit from it all. Of course, there will be lucky individuals who will be more successful than others, but the key is not to think we're experts in this, because we might just get lucky. Besides, I think there's a lot of insider trading, which makes me avoid betting there altogether.

[Findingnemo]

They are not crypto traders, they are people who just know the term crypto trading and came to make money to become rich but don't even know the difference between an exchange and prediction, end up burining their money and still blame the crypto for their ignorance, they always existed but came up with different reasons to lose their money.

[coin-investor]

If this trend continues, do you think crypto trading volume could eventually be affected, or prediction markets are still too small to make that kind of impact?

It takes years, a lot of effort, and a lot of study for traders to reach a level of profitability. I don't think they will just dump it and replace it with prediction markets; they could incorporate it into their activity but not leave it entirely. They will still trade, and they will bet on prediction markets.

They can do both, and they can possibly profit from both; prediction markets are another platform to showcase their prediction skills, not something they replace with something they have loved doing for many years.

[Dr.Bitcoin_Strange]

This makes me wonder what could happen to crypto trading volume if more active traders move to prediction markets. Maybe instead of day trading crypto, some people will just hold their coins, then use prediction markets for their short-term trading activity.

If this trend continues, do you think crypto trading volume could eventually be affected, or prediction markets are still too small to make that kind of impact?

Do you believe that activite and profitable traders will move from trading to prediction market? I don't even believe that unprofitable traders will completely move to prediction market, they could try it for fun or to try to make some money but just like gambling, there is no constant profitability in prediction market and that's why I don't believe that traders will completely move to prediction market.

Secondly, I don't agree with what you said that "price takes time to move in trading," that's not correct, the price of different crypto, stocks and forex pairs move very well every day, so a day trader will always see price movement in the market on a daily basis but what is important to note is whether the strategy you are trading plays out every day or not. If your set-up does not show up every day, then you have to be patient, unless you wan to gamble with your capital, then you can force a trade. Even in prediction market, you don't win every day.

I don't think crypto trading volume will be affected.

[Frankolala]

OP, is there any data to backup your post or you are only assuming it since, I find it difficult to believe that a trader who knows what he's doing will stop trading totally and go gamble in prediction market. There's no guarantee or making money in prediction market which makes it as risky as trading. So, if some amateur traders are moving to prediction market, it's the same thing as moving from frying pan to fire.

[Sandra_hakeem]

For normies who came into crypto for the memecoin mania in 2024-2025 moving onto the next hot thing aka prediction markets was a logical move. You see many of them coming back to gamble on Robinhood Chain memecoins now by the way so it's always ebbs and flows with these things. People follow the hype and the money.

They really do. It's always about how much they can make off of it, or the worth of a new experience altogether. Meanwhile, I think an active crypto trader is not a gambler. If there's a break , that doesn't necessarily mean they would switch sides to prediction markets. People ultimately need to like something enough to invest their money for profit imo.

OP, is there any data to backup your post or you are only assuming ~snip

What do you mean data to backup??

Source:
https://www.wsj.com/finance/currencies/for-many-individual-traders-prediction-markets-are-hotand-crypto-is-not-bef27e3d

[Agbamoni]

I don't see any direct correlation between crypto trading and the prediction market and if you ask me, crypto trading should be easier than the prediction market. The reason is simple, trading is more organized and have a lot of literatures covering the experiences of others and this can serve as reference for people to study and sharpen there skills. This is not the same with prediction market, hence the reason I consider it riskier than trading. Therefore, prediction market is not a threat to crypto trading.

They are both prediction markets. Crypto traders do trade for or against the crypto market to make gains, while in a prediction market, traders gain by betting on events. Prediction markets are more similar to trading brokers because the odds are opposite. Yes/NO, True/False. It's like betting on the two sides of a coin, which is directly similar to how traders trade crypto (BUY and SELL).

[Free Market Capitalist]

I don't see any direct correlation between crypto trading and the prediction market and if you ask me, crypto trading should be easier than the prediction market. The reason is simple, trading is more organized and have a lot of literatures covering the experiences of others and this can serve as reference for people to study and sharpen there skills. This is not the same with prediction market, hence the reason I consider it riskier than trading. Therefore, prediction market is not a threat to crypto trading.

You’re on board. I’m not much of a trader though, but I know that trading is a lot more organized than the prediction market, and even gambling.

Well, I think the opposite. If we were talking about Bitcoin alone, that would be one thing, but “crypto” trading? For the vast majority of users, it’s like going to a casino—no matter how much some people try to analyze it with charts, candlesticks, and so on. The volatility and unpredictability are so high that they further reduce the already slim chance of consistently making a profit compared to more traditional, less volatile forms of trading, like the stock market.

So, it makes sense to me that a percentage of those users are switching to prediction markets, because no matter how much they try to hide it, it’s just another new form of gambling—a growing market with new types of bets that’s attracting more people.