• S&P Dow Jones Indices and Kalshi announced a two-way commercial partnership on October 26: Kalshi will license S&P DJI benchmarks for event contracts, while S&P DJI will use Kalshi’s prediction-market data to develop new indices.
  • The agreement aims to integrate prediction markets with mainstream financial infrastructure, with potential indices covering economics, politics, and sports, though specific methodologies and launch dates were not disclosed.
  • The partnership could enable investors to gain exposure to real-world events and hedge risk through linked financial products, but regulatory hurdles remain for Kalshi’s sports-related contracts.

A Meeting of Benchmarks and Predictions

S&P Dow Jones Indices, a division of S&P Global (SPGI) (NYSE: SPGI), and event-contract exchange Kalshi have entered a two-way commercial partnership that could bring prediction markets closer to mainstream finance. The announcement, made on October 26, outlines a collaboration where Kalshi will license S&P DJI benchmarks for its event contracts, while S&P DJI will leverage Kalshi’s prediction-market data to create new indices. The move signals a significant step toward integrating event-based trading with traditional financial benchmarks, though the companies did not specify initial methodologies, launch dates, or financial terms.

The partnership has two distinct components: Kalshi contracts linked to existing S&P DJI indices will settle against official index values, and new indices derived from Kalshi markets could measure expectations about economics, politics, and sports. The official announcement did not confirm earlier reports of AI-job-disruption or weather indices, nor did it announce any ETFs, funds, or other securities tracking the proposed indices. S&P DJI explicitly stated that its licensing arrangement does not constitute an endorsement of Kalshi contracts.

Strategic Implications for Both Parties

For S&P Global, the agreement adds another market for benchmark licensing and proprietary data, aligning with its emphasis on high-growth adjacent businesses. The company reported strong third-quarter results this morning, with revenue from continuing operations up 7% year over year to $3.678 billion and adjusted diluted earnings per share up 9% to $4.58. Its indices division revenue grew 20% to $554 million, with adjusted operating profit up 22% to $398 million. However, the undisclosed commercial terms of the Kalshi partnership prevent a credible estimate of its earnings impact.

For Kalshi, the partnership provides standardized, independently calculated settlement references and an association with a major benchmark provider. This credibility boost is particularly valuable as the company faces criticism that its platform facilitates gambling. Kalshi, founded in 2018, operates an event-contract exchange where participants trade on real-world outcomes. Co-founder Tarek Mansour remains CEO, and the companies describe its customer base as millions of people and a growing number of institutions. Reuters (TRI) reported on October 21 that a new funding round valued Kalshi at approximately $40 billion, citing people familiar with the matter. Mansour also noted that sports represented close to 65% of revenue, down from approximately 95% nine months earlier, suggesting diversification.

Regulatory Clouds on the Horizon

The partnership’s immediate regulatory significance is primarily American, as the announcement contains no cross-border operating authorization. The central policy issue remains whether sports-related event contracts fall exclusively under federal derivatives regulation or also under state gambling laws. Kalshi and the Commodity Futures Trading Commission argue for federal jurisdiction, while states contend that sports contracts are gambling and should comply with state licensing, taxation, age restrictions, and consumer-protection requirements.

Recent developments make this a material business risk. Federal appeals courts have split: the Third Circuit favored Kalshi in the New Jersey dispute, while the Ninth Circuit and, on September 25, the Sixth Circuit issued decisions unfavorable to its efforts to block state regulation. New Jersey has petitioned the Supreme Court for review, and Kalshi’s response is due November 9, with a decision on whether to hear the case not expected before December. Review is not guaranteed. The Trump administration’s CFTC supports the federal-jurisdiction position, but opposition also comes from Republican-controlled states, including Ohio and Tennessee. This is therefore not a straightforward partisan divide.

The S&P agreement does not settle these disputes or confer blanket legal approval on every Kalshi market. On the same day as the S&P announcement, the CFTC and NBA announced cooperation on prediction-market oversight, and the NBA named Kalshi and Polymarket preferred prediction-market exchanges, with restrictions intended to protect sporting integrity. This contrasts with the NFL’s push for Supreme Court scrutiny, illustrating that major institutions are taking different approaches to the same industry shift.

What’s Next

In the near term, the market will look for product specifications: which S&P-linked contracts launch, how settlement works, and which Kalshi-derived indices S&P DJI actually publishes. Without disclosed economics, launch schedules, or methodologies, assigning a material revenue contribution to the partnership would be speculative. Management’s expectations are positive but interested: Mansour says the partnership can accelerate retail and institutional demand, while S&P DJI CEO Cathy Clay presents robust benchmarks as a means of defining and measuring a maturing market. These are corporate assessments, not independent forecasts.

Long term, the commercial opportunity is to turn prediction-market prices into a more standardized information layer for finance, potentially supporting additional analytics and linked products. However, commercial adoption is advancing faster than legal consensus. FTI Consulting (FCN)’s October 22 analysis identifies several possible paths to resolution—Supreme Court involvement, agency rulemaking, congressional action, or negotiated outcomes. Neither source establishes which outcome will prevail. The most useful interpretation is that this is a meaningful distribution and credibility milestone for prediction markets, while product execution, regulatory durability, and measurable financial returns remain unproven.

Correction: October 27, 2026: An earlier version of this article misstated the percentage of Kalshi’s revenue derived from sports. It is approximately 65%, not 95%.