What to Know
- Cboe is in talks to bring back all-or-nothing options to compete with prediction markets.
- These contracts pay a fixed amount if an event happens, and zero if it doesn’t.
- The move could attract retail traders and challenge crypto and regulated prediction platforms.
Cboe Global Markets, the U.S. derivatives exchange credited with creating the standardized options market, is in preliminary talks to reintroduce “all-or-nothing” options contracts. This move could put it in direct competition with booming prediction market platforms.
The opportunity comes as crypto prediction markets such as Polymarket and Kalshi have drawn significant retail interest by enabling traders to bet on yes-or-no outcomes from election results to economic indicators using binary outcome contracts.
What Are “All-or-Nothing” Options?
Also known as binary options or fixed-return contracts, all-or-nothing options pay a fixed amount if a specific condition is met at expiration and nothing if it isn’t. For example, a contract might promise $1 if the S&P 500 ends above a certain level by a given date; if it doesn’t, the trader loses their entire stake.
This payoff structure mirrors prediction market contracts, where outcomes resolve to $1 or $0 depending on whether a forecast event occurs.
Why Cboe Is Considering a Comeback
Cboe previously offered these binary structures in 2008, but they were delisted due to low demand among traditional retail investors. Now, with record trading volumes in options and a resurgence of retail participation in complex financial products, the exchange sees renewed potential.
By reintroducing simple yes-or-no event contracts within a regulated environment, Cboe aims to capture traders drawn to event-driven contracts that resemble prediction market activity, provide a regulated alternative to crypto-based decentralized prediction platforms and offer a gateway for new traders into more sophisticated options markets over time.
JJ Kinahan, Cboe’s head of retail expansion, told the Journal the exchange will “go through a lot of rigor” on legal and compliance requirements before listing any new contracts, which would be regulated by the SEC or CFTC. Kinahan described the potential product as “the new starting point for many people in terms of how to get into the options space.”
Crypto and Prediction Markets
In the crypto world, decentralized prediction markets have flourished by leveraging blockchain technology to create transparent, peer-to-peer markets for event outcomes. These markets not only attract traders but also serve as unique indicators of collective sentiment, a feature increasingly admired by on-chain analysts.
Cboe’s potential entry into this space even if focused on financial event contracts signals a blurring line between traditional financial derivatives and crypto-native prediction mechanisms. If realized, the move could encourage further institutional interest in prediction-style betting products, push more regulated, mainstream options into areas once dominated by crypto platforms and spur dialogue between regulators on how to treat binary and event-driven contracts.
Regulatory and Market Context
Binary options have faced regulatory scrutiny historically due to fraud concerns and risk-all behavior. Cboe has indicated that any relaunch would be tightly regulated under the auspices of the SEC or CFTC before being offered to retail investors.
This contrasts with many crypto prediction markets, which operate in legal grey areas or under decentralized frameworks though some, like Polymarket, have sought regulated status to better align with U.S. financial rules. Kalshi and Polymarket together logged more than $17 billion in January trading volume, an all-time monthly high, according to data. Kalshi recorded $9.55 billion in January, up from $6.58 billion in December 2025, a roughly 45% increase. Polymarket posted about $7.66 billion in January versus $5.31 billion in December last year, a gain of about 44%. January marked the fifth consecutive month of rising activity across the sector.
Final Thoughts
Cboe revisiting all-or-nothing options represents a significant development at the intersection of traditional finance and crypto-style markets. By leveraging regulated derivatives to mimic the simplicity and excitement of prediction markets, Cboe may help bridge the gap between mainstream investors and the growing world of event-based contracts that many in the crypto community already embrace.
Also Read: Crypto Investment Products See $1.7B Weekly Outflows, BTC and ETH Lead
