Nasdaq Enters Prediction Market, Plans to Launch 100 Index Binary Options

Odaily News Nasdaq Inc. plans to launch an options contract that allows "yes or no" bets on major stock indices, becoming the latest exchange operator to enter the rapidly growing prediction market. According to a rule change proposal submitted to the U.S. Securities and Exchange Commission, the company hopes to list "binary options" on its flagship Nasdaq 100 Index and the Nasdaq 100 Micro Index. Documents show that the pricing of Nasdaq contracts will range from 1 cent to 1 dollar, reflecting the market's view on the likelihood of a particular outcome. This would be Nasdaq's first foray into products mirroring the prediction market. These so-called "outcome-linked options" would allow traders to take binary positions on whether a specific event occurs. Binary options are simplified versions of options contracts whose payouts depend on the outcome of a "yes or no" proposition. The prediction market industry lists financial contracts related to sports, politics, and pop culture. Unlike the event contracts of Kalshi, Polymarket US, and CME, which are regulated by the U.S. Commodity Futures Trading Commission, binary options are regulated by the U.S. Securities and Exchange Commission. Nasdaq's contract is currently awaiting SEC approval. (Jin10)