Meta Is Building a Prediction Market App. Its Biggest User Base Can't Legally Use It.
Mark Zuckerberg has personally directed an internal team to develop a standalone prediction market app codenamed "Arena," entering a sector that has grown from under $1 billion in monthly trading volume to nearly $24 billion in under two years, according to CFTC data tracking industry-wide volume from June 2024 to April 2026.
Employees cited by the New York Times reported on June 23 that the project is underway, with Arena designed to let users forecast outcomes across politics, sports, entertainment, and world events. The app would launch separately from Facebook and Instagram, though Meta intends to use its social platforms to drive adoption. Employees described the project internally as both experimental and a top priority for Zuckerberg. It may never reach the public.
The initial design calls for a gamified points system rather than real-money wagering, a choice that may carry regulatory logic as much as product logic. The New York Times reported that real-money betting has not been ruled out for future versions. This is Meta's second attempt at prediction markets. Its earlier app, Forecast, launched in 2020 during the COVID-19 pandemic and was discontinued in 2022.
A Market That Has Already Moved
Prediction markets expanded sharply after Polymarket's high-profile run during the 2024 U.S. presidential election, which brought mainstream attention and trading volume to the concept. Combined monthly volume on Kalshi and Polymarket grew from below $5 billion in September 2025 to approximately $24 billion by April 2026, with January 2026 setting a single-month record of $26.75 billion. Together, Kalshi and Polymarket controlled roughly 97.5% of total market share in 2025, according to KuCoin data, though that figure predates the sharper volume growth seen in early 2026. The scale of product growth is equally striking: active contracts traded on prediction platforms grew from approximately 220 per year in 2021 to over 8,000 per month by May 2026, according to the CFTC Federal Register.
April 2026 marked a notable shift within that duopoly. Kalshi posted $5.42 billion in taker volume, surpassing Polymarket's $1.99 billion in U.S. volume for the first time. Polymarket's international segment remains far larger, at approximately $9 billion in the same month, a figure that underscores how globally distributed demand for these products already is. Sports contracts dominate Kalshi's volume at 80%, with politics and crypto accounting for most of the remaining balance. Coinbase, Kraken, and Robinhood have also entered or explored this space in recent months.
The CFTC issued a proposed rulemaking on June 10 that would formalise how event contracts on prediction platforms are regulated in the United States. The proposal introduces a three-step framework covering commodity classifications, permitted activity types, and a public interest test. Sports contracts tied to aggregate outcomes such as scores or standings are more likely to be permitted under the draft rules; contracts on player injuries or officiating decisions are less likely to pass. The comment window closes July 27. That regulatory outcome will be a key factor in determining whether any U.S.-based version of Arena could ever accept real money.
The India Problem
Meta's distribution advantage is real and significant. The company reported 3.58 billion daily active people across its platforms as of December 2025. India alone accounts for 403 million Facebook users and 481 million Instagram users, making it Meta's single largest national market. With approximately 1.02 billion internet users as of September 2025, India represents a concentration of addressable scale that gives those user figures their full weight.
That same market is currently closed to real-money prediction trading. India's Online Gaming (Promotion and Regulation) Act 2025 received presidential assent in August 2025 and came into force on May 1, 2026, classifying prediction markets as prohibited online money gaming. The outcome was foreseeable well in advance: the industry had nine months between assent and enforcement. Polymarket was blocked in India shortly after. A points-only version of Arena could potentially avoid triggering that law at launch, but any move toward real-money markets would face a direct conflict with Indian regulation. The commercial opportunity and the legal ceiling sit in the same country.
By contrast, Nigeria and Pakistan currently allow Polymarket access without restriction, and both represent meaningful audiences for a mobile-first, social-integrated forecasting product. Neither country has formal prediction market regulation in place. Meta's distribution advantage in Nigeria runs particularly deep, extending through WhatsApp and Instagram, both Meta-owned platforms that are dominant across Sub-Saharan Africa.
South Africa occupies a more complex position. The country has one of Africa's more developed crypto regulatory environments, with the Financial Sector Conduct Authority classifying crypto assets as financial products under FAIS, the Financial Advisory and Intermediary Services Act. Prediction markets, however, remain in a legal grey zone, potentially subject to the Financial Markets Act, the National Gambling Act, and exchange control regulations simultaneously. A legal analysis from ENS Africa concluded that this layered overlap creates classification uncertainty that simpler crypto products do not face. A gamified, no-money product from Meta might initially avoid scrutiny. Real-money contracts would not.
What Comes Next
Arena is early enough that it may not ship at all. But even as a signal, it confirms that the prediction market sector has cleared a credibility threshold that draws in platform-scale competitors. The risk for Polymarket and Kalshi is less about losing volume directly to Meta and more about what happens to regulation in jurisdictions that have not yet decided how to treat these products. A Meta-scale entrant normalises the category fast, and that can push governments toward clearer rules in either direction.
The CFTC comment deadline on July 27 is the most immediate regulatory event to watch. Its outcome shapes not just whether Arena can ever go real-money in the U.S., but the precedent other markets will reference when drafting their own frameworks.
This article draws on reporting first published by the New York Times on June 23, 2026. The underlying report is behind a paywall for some readers.