The Nasdaq exchange wants to list binary options linked to its flagship stock indexes, a move that would allow traders to bet yes or no on the direction of major stock indexes like the Nasdaq-100.
In a filing with the U.S. Securities and Exchange Commission (SEC) on Monday, the exchange said it also plans to offer binary options on the Nasdaq-100 Micro Index.
A binary option is a bet with only two outcomes. Either the condition is met and the bettor walks away with a profit, or the option expires worthless. Contracts offered by Nasdaq would be priced between 1 cent and $1, reflecting the market’s view of the likelihood of a specific outcome occurring.
If approved, the products would operate similarly to contracts on prediction market platforms such as Polymarket and Kalshi, providing traders with a new way to express their short-term opinions on the performance of one of the market’s most closely watched stock indices.
The filing marks Nasdaq’s entry into a rapidly growing segment of derivatives markets that combines traditional finance with the mechanics of prediction platforms. Rival exchange Cboe also announced plans to expand into the prediction markets business, as interest in event-based trading has increased.
The surge follows the rapid growth of platforms such as Polymarket and Kalshi, which allow users to trade on the results of events ranging from elections to the release of economic data. These platforms are regulated by the Commodity Futures Trading Commission (CFTC) because they offer event-driven contracts tied to real-world outcomes.
Binary options, however, fall under the jurisdiction of the SEC. Nasdaq’s proposal highlights the extent to which established exchanges are seeking to adapt the prediction-style format to regulated securities markets. Nasdaq did not respond to a request for comment at the time of publication.
Crypto exchanges have also evolved rapidly.
Coinbase recently rolled out prediction markets on its platform, allowing digital asset traders to access contracts tied to political, economic, and cultural events. Gemini received approval from the CFTC in December to operate as a Designated Contract Market (DCM), allowing the company to offer regulated prediction markets to U.S. customers.
