Mark Zuckerberg has a new target: prediction markets. According to a report from The New York Times, Meta has assigned a small internal team to build a standalone app — internally called “Arena” — that would let users bet on the outcome of everything from elections and sports to economic data and entertainment news.
The project would put Meta in direct competition with Polymarket and Kalshi, the two platforms that have turned prediction markets into one of the fastest-growing corners of finance over the past two years.
How “Arena” Would Work
Unlike Polymarket and Kalshi, where users trade real money on contracts tied to future events, Meta’s app is expected to launch with a video-game-style points system instead of cash wagers. The company reportedly hasn’t ruled out adding real-money betting down the line, but for now the plan is lower-stakes — closer to a prediction game than a trading exchange.
The app would run separately from Meta’s main platforms — Facebook, Instagram, WhatsApp, and Messenger — though Meta could eventually use its massive social reach to funnel users toward it. Sources cautioned the project is still experimental and could be shelved before ever launching publicly. It’s reportedly one of several early-stage bets at Meta, alongside another project called “Meta Photos,” focused on AI-generated media.
Why Now: A Market Exploding in Size
Prediction markets have gone from a niche curiosity to a multibillion-dollar industry almost overnight. Combined monthly trading volume on Kalshi and Polymarket jumped from under $5 billion in September 2025 to roughly $24 billion by April 2026. Industry-wide, operators handled more than $50 billion in trades last year, and volume has already topped $130 billion in 2026.
Kalshi, founded in 2018, saw its valuation double to $22 billion in May 2026 — just six months after its previous funding round. Polymarket, which built its name on politics and sports betting, has become a cultural fixture in its own right, with public profiles showing users’ bets, profits, and losses in real time.
The World Cup has only accelerated the trend: DraftKings reported that its Predictions product tripled its first-time customers in the tournament’s opening week alone, with trading volume up 87% since kickoff.
Wall Street Notices Immediately
News of Meta’s plans rattled the betting industry the moment it broke. Shares of DraftKings and Flutter Entertainment, the parent company of FanDuel, both fell, as investors weighed Arena as a new threat to traditional sportsbooks. DraftKings stock has already lost roughly 30% of its value this year as Kalshi and Polymarket eat into the sports-betting market — a Meta entrant, even a points-based one, adds another competitor circling the same audience.
A Sector Already Under Scrutiny
Meta’s timing places it in a market that regulators are watching closely. In May 2026, the U.S. House Committee on Oversight and Government Reform opened an investigation into Polymarket and Kalshi to examine how the platforms guard against insider trading and other abuses. Several states have also moved to restrict or ban election-related betting contracts altogether.
The sector has had its share of controversy: Kalshi reported former New York congressman George Santos to federal prosecutors over a bet tied to his own attendance at a State of the Union address, and in April the Department of Justice said a special-operations officer used classified information to net $400,000 betting on the political fate of Venezuela’s Nicolás Maduro before his capture by U.S. forces in January.
Notably, Donald Trump Jr. is reportedly an advisor to both Polymarket and Kalshi, while the Trump family’s media company has launched a competing prediction site of its own, TruthPredict.ai — putting more political weight behind a market Meta now wants a piece of.
The Bigger Picture
For Meta, Arena would be the latest attempt to find a foothold in the broader world of online finance and payments, following the shutdown of its Libra/Diem stablecoin ambitions years ago. Whether or not the app ever reaches the public, its mere existence signals how mainstream prediction markets have become — popular enough that the world’s largest social media company wants in, and threatening enough that betting and trading platforms are already feeling the pressure on Wall Street.
