Alpaca, an API-first brokerage technology provider based in New York, has moved a step closer to entering the prediction market sector after its subsidiary, Alpaca Derivatives LLC, registered with the Commodity Futures Trading Commission (CFTC) as a futures commission merchant (FCM) and became a member of the National Futures Association (NFA).
The CFTC serves as the federal regulator overseeing prediction markets operating in the United States. Alpaca’s registration provides the necessary regulatory status to offer access to event contracts traded on prediction markets. The company intends to introduce a wider range of futures products with regulatory approval.
Alpaca sees this move as part of a broader strategy to cater to financial companies interested in expanding into additional markets through a unified infrastructure provider.
“Alpaca is developing a comprehensive platform for financial companies looking to broaden their market access,” stated Tony Lee, Alpaca’s Chief Brokerage Officer.
“Entering a new market often requires integrating multiple providers and handling added operational complexity. By incorporating event contracts into our platform, we can offer partners a simpler way to expand their offerings through their existing infrastructure used to develop and grow their businesses,” Lee added.
Additionally, Yoshi Yokokawa, Alpaca’s Co-Founder and CEO, expressed, “As financial markets become more interconnected and programmable, financial companies need regulated infrastructure that simplifies the introduction of new products to the market.”
Client Base Spans Brokerages, Fintechs, and Quant Funds
Alpaca’s client roster includes brokerage firms, fintech companies, software developers, algorithmic trading platforms, and quantitative funds. Brokerage firms and fintech companies have already shown interest in prediction market products, supporting Alpaca’s venture into event contracts for its client base.
The company serves over 10 million accounts across more than 40 countries and has secured $400 million in financial backing from investors like Drive, Social Leverage, and Tribe Capital.
Prediction markets enable participants to trade event contracts linked to the outcomes of future events, tools for forecasting, planning, or hedging against real-world outcomes.
Industry Volume Surges as Sector Diversifies Beyond Sports
Trading activity in prediction markets has soared in recent months. Combined monthly global trading volume across the two leading platforms surged nearly fivefold over seven months, reaching around $24 billion by April 2026, according to Pew Research Center.
Total market volumes are projected to hit $240 billion in 2026, with some estimates suggesting growth to $1 trillion by 2030, while other analyst projections foresee potential annual industry volume of $1.5 trillion by that year.