Cboe, one of the largest US derivatives exchanges, said it is entering the prediction market arena and reviving binary options on the S&P 500 index after abandoning them more than a decade ago, a move that puts it in competition with platforms such as Kalshi and crypto-native Polymarket.
A binary option is a yes or no bet that pays a fixed amount if an outcome occurs, in this case if the benchmark US stock index crosses a specific level. This is close to what Polymarket and Kalshi already offer, although their offerings go beyond stock market forecasts to cover political and sports results, as well as other topics.
The introduction follows Cboe’s success with same-day S&P 500 options, contracts that expire within hours and now account for about 30% of US options volume, drawing attention to the demand for fast, results-based trading.
“Investors are increasingly looking for products that allow them to express a specific view on future events and market outcomes,” Milan Galik, CEO of Interactive Brokers, which manages binary contracts, said in a statement.
The contracts will also be available at Charles Schwab later this year.
second time
Cboe has tested this market before. It first listed binary options on the S&P 500 and the Cboe Volatility Index in 2008, but they failed to generate interest and were withdrawn, with the last such contract expiring in 2017.
