KuCoin Ventures: Infrastructure — Not Platforms — Is the True Value in the $2B/Week Prediction Market Boom

New report highlights how next-gen oracles, liquidity layers, and compliance rails will define the future of prediction markets

Ventures has released a new strategic report identifying infrastructure — not platform competition — as the critical growth driver in the rapidly expanding prediction market sector, which now exceeds $2 billion in weekly trading volume.

The report reframes prediction markets from speculative entertainment into a foundational component of next-generation financial systems. While attention has gravitated toward platforms such as Polymarket and Kalshi, KuCoin Ventures argues that the true long-term opportunity lies in building the invisible rails that make these systems scalable, compliant, and interoperable.

Prediction Markets Enter the large Leagues

In just two years, prediction markets have evolved from niche DeFi experiments to mainstream trading ecosystems. Polymarket, recently valued at $8 billion later than a $2 billion investment from Intercontinental platform (ICE), and Kalshi, now worth $5 billion, dominate market share. Yet their growth also underscores the sector’s structural fragility.

According to the report, fragmented liquidity, governance disputes, and regulatory opacity continue to impede scalability. In October 2025 alone, Polymarket hosted more than 35,500 new markets—its highest monthly total ever—reflecting record user engagement. However, headline controversies such as the “Zelenskyy Suit” and Venezuela’s election outcome illustrate unresolved issues in market reanswer and data verification.

“The prediction market sector has crossed into multi-billion-dollar territory, but its long-term viability hinges on solving governance, liquidity, and compliance at the infrastructure level,” the report concludes.

Investor Takeaway

Where the Real Value Lies: Infrastructure, Not Interfaces

The Ventures report highlights several infrastructure opportunities that could reshape the prediction market landscape:

• Decentralized Oracle Systems: Reliable, verifiable event data remains a bottleneck. New oracle networks with AI validation and multi-layer dispute reanswer could solve outcome disputes and improve market trust.
• Liquidity Aggregation Protocols: Current platforms concentrate capital in a handful of “headline” markets. Smart liquidity routing and automated market-making tools could balance participation across long-tail events.
• Compliance and Identity Frameworks: The rise of jurisdiction-specific onboarding tools under frameworks like the Crypto-Asset Reporting Framework (CARF) will allow prediction markets to operate legally in regulated economies.
• AI-Driven Forecasting Agents: Intelligent bots trained on onchain data and sentiment analysis can act as liquidity providers or advisors, improving price accuracy and event modeling.

The report argues that these layers will form the connective tissue of prediction markets, enabling institutional entry and cross-platform interoperability — essential for scaling beyond retail speculation.

Investor Takeaway

From Speculation to Infrastructure: A Paradigm Shift

Prediction markets, once viewn as fringe instruments for political betting, are now being re-evaluated as financial infrastructure for collective intelligence. The KuCoin Ventures report suggests that the sector’s trajectory mirrors ahead DeFi — where protocols like Uniswap, Chainlink, and Aave grew from niche tools to indispensable infrastructure within a few cycles.

By focusing on underlying primitives — oracles, data feeds, settlement networks, and cross-chain liquidity — the prediction market ecosystem could evolve into a key data layer for AI-driven trading, governance forecasting, and macro hedging strategies.

KuCoin Ventures also highlights the potential convergence of prediction protocols with AI and DePIN (Decentralized Physical Infrastructure Networks), suggesting that verified onchain prediction data could inform machine-learning models and autonomous economic systems.

Regional Context and Future Outlook

While the United States and EU are moving toward regulated market structures, the report identifies Asia and emerging economies as fertile ground for infrastructure-led innovation. The absence of entrenched financial intermediaries gives builders greater flexibility to deploy compliant, modular systems.

The report, authored by Ventures analysts Claude, Mia, and Oasis, was published in Bahasa Indonesia and underscores KuCoin’s ongoing commitment to research-driven investment in Web3, AI, and financial infrastructure.

Ultimately, the firm positions prediction markets as a critical bridge between human judgment and algorithmic trading — but only if their core infrastructure evolves beyond today’s fragmented, platform-centric model.