Plus500 moves to cash in on World Cup boom in prediction markets

London-based trading company Plus500 is seeking to tap into the fast-growing market for sports prediction products in the United States, unveiling plans to offer customers access to contracts based on the outcome of major sporting events, including the football World Cup, through Kalshi, the New York-based prediction markets exchange.

The move places the FTSE-listed group squarely in one of the most hotly contested corners of modern finance, where betting and trading are increasingly converging. Prediction markets allow customers to speculate on the likelihood of future events, with contracts priced according to the perceived probability of an outcome. The business has become a particular focus during the World Cup, where interest from retail punters and speculative traders has risen sharply as the tournament has gathered pace.

Plus500 said the new offering would cover major American sporting events including the National Football League, the National Basketball Association and Major League Baseball, with the football World Cup also expected to feature as the tournament unfolds in North America. The contracts will be supplied via Kalshi’s exchange and traded in the form of financial contracts rather than through a conventional gambling platform. In practice, customers are not simply placing a bet with a bookmaker but entering into a market where the price reflects the crowd’s assessment of an event’s odds.

The announcement comes at a moment when prediction markets are enjoying a remarkable surge in activity. Trading volumes across the two leading platforms, Kalshi and Polymarket, rose to about $24 billion in April, according to the Pew Research Centre. Analysts say sports contracts now account for the bulk of that activity, with Bank of America estimating that sporting markets represent around 85 per cent of volumes in prediction markets. That concentration has made sport the sector’s most obvious commercial driver and its most legally and politically sensitive one.

Jefferies said Plus500’s entry into the market broadens the company’s addressable opportunity, particularly as the World Cup progresses and attention shifts towards the rest of the tournament. The bank noted that Kalshi is among the leaders in sports prediction markets, with more than $10 billion of sports prediction contracts traded in May alone. Bank of America described the expansion as an important product offering, arguing that the rise in volumes since the start of the World Cup has been exceptionally high, with week-on-week growth of 40 per cent over the past fortnight.

The attraction is plain enough. Unlike traditional gambling products, prediction markets are structured as peer-to-peer trades. Customers are effectively taking positions on future outcomes, whether that means the result of a football match, the success of a company’s share price or, in the more eccentric corners of the market, questions as outlandish as who might be invited to a celebrity wedding. Supporters argue that the model offers greater transparency and a more disciplined pricing mechanism than standard betting. Critics, however, have long pointed to the same space as a grey area in which the distinction between financial speculation and gambling can be difficult to sustain.

For Plus500, the expansion is as much about market positioning as it is about immediate revenue. David Zruia, the company’s chief executive, said the move marked an important milestone and reflected the technological capabilities and infrastructure the group has built. He said the new product advanced Plus500’s next-generation prediction markets offering and placed it directly in the middle of the US retail market. In his telling, the appeal lies in the pace and intensity of the sector, spanning the NFL, NBA, MLB and beyond.

The company’s timing is no accident. World Cup trading typically attracts intense short-term activity, and analysts believe the event has amplified public awareness of prediction products. Sports events have emerged as the defining category in the sector, not only because they are easy for customers to understand but because they deliver a constant stream of binary outcomes that can be priced and repriced quickly. That makes them particularly well suited to a trading format that relies on liquidity, rapid turnover and a large base of retail participants.

Plus500 is already an established player in leveraged trading, and the prediction market move builds on a broader strategy of expansion in the United States. The company entered the American market more aggressively after its acquisition of Cunningham, a futures commission merchant and trading platform, in 2021. It now generates about 15 per cent of its revenues from the US, a share that could rise if the new sports contracts gain traction with retail customers drawn to the overlap between speculation, sport and short-term market movement.

The firm’s position in the market is also significant because it is one of several London-listed trading groups that profit from customers seeking exposure to financial movements without necessarily buying the underlying asset. In the spread betting and contracts for difference market, that model has long been popular partly because it can allow retail investors to trade without paying stamp duty. Plus500 has built its business around contracts for difference, a product it says carries substantial risk. On its website, the company warns that 76 per cent of retail investor accounts lose money when trading CFDs with the group.

That risk warning sits uneasily alongside the commercial upside now being pursued. Plus500 has more than 30 million account holders and has benefited this year from volatile markets driven by developments in artificial intelligence and the US-Iran war. Its shares have risen by 30.5 per cent so far this year, and on Monday the stock gained a further 1.7 per cent to £47.62. In April the company reported its highest customer income for five years and upgraded its full-year expectations after first-quarter revenue rose 18 per cent to $242.1 million.

The broader picture is of a trading company adapting rapidly to a changing retail environment. Where once the focus was on currencies, indices and commodities, a growing amount of activity is now being directed towards event-based speculation, with sport at the centre. That shift reflects changing customer habits, but also a commercial reality: markets that can be understood in a glance and resolved in a matter of hours tend to generate volume, and volume is what the platforms need.

There is also a regulatory dimension that cannot be ignored, even if it sits in the background of the company’s announcement. Prediction markets operate in a space where financial regulation, gaming law and consumer protection all intersect. Their advocates insist they are legitimate exchanges for information and probability. Their critics fear that the packaging of wagers as financial contracts can obscure the true nature of the product, particularly when it is marketed to retail customers already accustomed to speculative trading.

For now, though, the commercial momentum is clearly with the sector. Polymarket, the American site often seen as Kalshi’s principal rival, has helped push prediction markets into the mainstream through a combination of political and sporting contracts that attract enormous attention online. What was once a niche domain has become a trading phenomenon, and World Cup football has provided exactly the kind of global stage that accelerates it. The competition between platforms is no longer simply about who can process the most trades, but who can define the category itself.

Plus500’s decision suggests that established trading houses increasingly see prediction markets not as a curiosity but as a natural extension of their product suite. The logic is straightforward: if customers are already comfortable taking leveraged positions on financial instruments, the leap to event contracts may not be as great as it once seemed. Sport gives that proposition mass appeal, while the financial wrapper gives it a veneer of sophistication and liquidity.

That convergence may prove lucrative, but it also sharpens the questions surrounding the industry’s future. As sporting contracts become a larger share of overall prediction volumes, the distinction between investment platform and betting exchange grows more blurred. The present boom may be powered by the excitement of the World Cup, yet the longer-term challenge will be whether these markets can sustain interest once the tournament ends and whether regulators are content to let them expand further into territory that has traditionally belonged to bookmakers.

For Plus500, however, the immediate calculation is clear. The company has identified a fast-growing, high-volume market and intends to establish itself within it while the opportunity remains open. In doing so, it has aligned itself with a business that is no longer on the fringe of retail trading but increasingly at the centre of it, where sport, speculation and financial engineering now meet in a single, closely watched marketplace.