Zuckerberg is building a prediction market app called Arena to take on Polymarket and Kalshi

Mark Zuckerberg has personally directed a small team to build a standalone prediction market app called Arena, positioning Meta to compete directly with Polymarket and Kalshi as event-based forecasting moves from the crypto ecosystem into mainstream technology, according to reporting by Reuters and the New York Times.

The initiative, reportedly championed by Chief Executive Officer Mark Zuckerberg, comes as prediction markets increasingly attract retail traders, institutional capital, and crypto participants seeking alternative sources of market intelligence.

The project, internally known as “Arena,” would initially operate as a points-based forecasting platform rather than supporting real-money wagering, according to people familiar with the matter.

However, Meta has reportedly not ruled out integrating monetary stakes in future iterations.

The app is expected to function independently from Facebook, Instagram, WhatsApp, and Messenger, although Meta could leverage its vast user ecosystem to drive adoption.

Prediction markets move closer to the mainstream

Prediction markets have evolved rapidly from niche forecasting tools into one of the fastest-growing segments intersecting finance, crypto, and social media.

Platforms such as Polymarket have benefited from heightened interest surrounding elections, geopolitical developments, macroeconomic events, and digital asset trends.

According to reports citing industry estimates, prediction markets could eventually generate annual trading volumes approaching $1 trillion by the end of the decade.

“Mark Zuckerberg recently directed a small team to create the app, which is internally called ‘Arena.”

Reuters reported, citing a New York Times account based on employees familiar with the plans.

The reported strategy mirrors Meta’s historical playbook of adopting emerging digital behaviors and scaling them through its distribution network.

The company previously launched products inspired by short-form video and disappearing stories after competitors demonstrated strong consumer demand.

Meta also experimented with forecasting products in the past. Its Forecast application, launched in 2020, allowed users to crowdsource predictions on social and scientific issues but was ultimately discontinued.

Crypto-native platforms face a powerful competitor

For crypto investors, Meta’s interest in prediction markets represents more than another social media experiment.

Polymarket has become one of the most recognizable blockchain-based forecasting venues, enabling users to speculate on real-world outcomes using cryptocurrency infrastructure.

The platform experienced explosive growth during major political events and has increasingly attracted sophisticated traders looking for information advantages.

Kalshi, meanwhile, operates under a regulated framework in the United States, offering event contracts tied to economic indicators, elections, sports, and cultural developments.

“Prediction markets gained traction during the 2024 U.S. presidential election and have become a notable asset class.”

Reuters noted in its reporting on Meta’s initiative.

Meta’s entry could significantly expand awareness of event-based forecasting by introducing prediction mechanics to billions of existing users.

The company reported approximately 3.56 billion daily active users across its family of applications earlier this year, giving Arena a distribution advantage that few competitors can match.

Some analysts believe that even a points-only version could function as an onboarding funnel, familiarizing mainstream users with prediction market concepts before broader monetization strategies emerge.

Regulatory scrutiny remains a key obstacle

Despite growing enthusiasm, prediction markets continue to face regulatory and ethical challenges.

Critics argue that large-scale event trading can create incentives for manipulation, misinformation campaigns, and trading based on privileged information.

Questions also remain regarding whether certain event contracts resemble gambling products or financial derivatives requiring closer oversight.

Arena’s reported decision to begin with a gaming-style points system may reflect Meta’s desire to avoid immediate regulatory complications while testing consumer appetite.

“Unlike its inspirations, Arena will initially not involve money,” technology publication The Verge reported, citing individuals familiar with the project, while noting that Meta has not excluded real-money functionality in the future.

For crypto market participants, Meta’s reported ambitions highlight a broader trend: prediction markets are increasingly being viewed as a legitimate information asset class rather than merely speculative venues.

Whether Arena succeeds or follows the path of Meta’s earlier forecasting experiments remains uncertain.

However, Zuckerberg’s reported interest suggests that prediction markets are moving beyond the crypto ecosystem and into the strategic roadmap of some of the world’s largest technology companies.