Charles Schwab and Citadel Securities are studying whether to enter prediction markets, but both firms said they have no formal launch plans at this stage. The comments came on Thursday in separate public appearances, one during an earnings call and the other at a conference in Washington, D.C.
Charles Schwab CEO Rick Wurster said the firm could eventually add prediction markets to its brokerage platform. He described the product as relatively simple from an operational standpoint. Even so, internal surveys showed limited interest from clients, which has kept the company from moving ahead quickly.
Schwab narrows the scope of any potential offering
Wurster said Schwab would not consider contracts tied to sports, politics, or entertainment. He argued that those areas do not fit the firm’s focus on long-term wealth building. He also pointed to poor outcomes among retail gamblers as a concern.
That leaves Schwab in a selective posture. If the company does add prediction markets later on, the product set would likely be much narrower than what some existing platforms already offer. For now, the central question is whether the format matches client demand and the firm’s broader platform strategy.
Citadel looks at event contracts as hedging tools
At Citadel Securities, Jim Esposito said the firm is monitoring the market but has not committed to taking part. He described limited liquidity as a current constraint. His view is that the market may become larger over time, but the present level of depth is still a hurdle.
Esposito said event-based contracts could serve as hedging instruments. He cited election-related risks as one example of the kind of event that can affect portfolio performance. Like Schwab, Citadel is not considering sports-linked markets.
Rapid platform growth brings heavier scrutiny
The interest from both firms comes as platforms such as Kalshi and Polymarket continue to grow. Token Terminal data showed their combined monthly trading volume reached $23.6 billion in March, a figure that has drawn wider attention to the sector.
Regulatory scrutiny is rising at the same time. Authorities in several U.S. states have challenged some offerings, arguing that they amount to unlicensed sports betting. Federal lawmakers have also raised concerns about insider trading risks and unresolved questions around market structure.
With regulatory clarity still lacking and liquidity not yet deep enough, both Schwab and Citadel remain in evaluation mode. Any move into prediction markets will depend on whether demand, compliance conditions, and market depth become more favorable.