Cboe Global Markets confirmed that it is developing a new options-based product that offers all-or-nothing payouts, a structure that could put the exchange in direct competition with prediction markets such as Polymarket, Kalshi, Robinhood. and Coinbase.
Cboe, the leading venue for options trading and famous for creating the Cboe Volatility Index (VIX), is in early talks with brokers and market makers about how the product would work, according to a previous WSJ report.
While details are still being finalized, the goal is to use a traditional options container to offer fixed-return outcomes in yes-or-no style event contracts, a person familiar with the situation told CoinDesk.
These types of derivatives, sometimes called binary options or fixed return contracts, allow traders to bet on whether a specific event will occur. If the event occurs, the contract pays a fixed amount in cash. If not, it remains at zero. That payout structure reflects the mechanics of prediction markets, where users bet on everything from central bank moves to election results.
Cboe is no stranger to binary style options. In 2008, the exchange launched binary call options linked to the S&P 500 and the Cboe Volatility Index (VIX), allowing traders to bet on whether those indexes would close above a certain level. But the products struggled to gain traction and were eventually delisted.
This new initiative, however, is not intended to be a direct relaunch of those previous instruments, the person told CoinDesk. Instead, Cboe appears to be exploring ways to modernize the concept and appeal to a broader base of retail and institutional users. A key goal is to deliver a better end-user experience, possibly with more intuitive market access or clearer contractual terms.
If launched, the offering could gain a foothold in a fast-growing segment of the derivatives market. Platforms like Kalshi, a CFTC-regulated venue, already offer event-based contracts on macroeconomic outcomes. Polymarket, which operates on a blockchain, has seen increasing volumes during election cycles and high-profile geopolitical events. Coinbase (COIN) also recently launched prediction market trading on its platform in partnership with Kalshi.
The exchange has not yet confirmed a timeline and it is not yet clear what specific events or outcomes the contracts would target.
