Cboe Global Markets, the Chicago-based options exchange, has moved into one of the year's hottest corners of finance. On June 23 it introduced "Cboe Predicts," a suite whose first products let traders bet on where the S&P 500 will finish on a given day.

The mechanics are simple. The contracts are binary options — instruments that pay a fixed amount if a stated condition is true and nothing if it is not. According to Cboe, a "yes" position pays $100 if the index settles at or above a chosen level, and a "no" position pays $100 if it settles below. The price you pay to enter functions as an implied probability: a contract quoted near $60 reflects roughly 60% market-assigned odds of that outcome.

The products are tied to the Mini-S&P 500 Index (XSP), which is scaled to one-tenth the size of the headline SPX index, lowering the capital needed to trade. They list under the tickers XSPBW and XSPBX and are cash-settled.

The regulatory distinction

The most important detail is how these contracts are regulated. A prediction market is any venue where people trade contracts whose payout depends on a future event — an election, a sports result, a price level. Such instruments are called event contracts when they fall under the Commodity Futures Trading Commission (CFTC). That is the path taken by Kalshi and Polymarket, whose model is being challenged under various state gambling laws.

Cboe took a different route. Because it is an established securities exchange, its contracts are security options that clear through the Options Clearing Corporation (OCC) and trade within the same regulatory framework as U.S.-listed options, under SEC oversight. That structure sidesteps both CFTC event-contract jurisdiction and the state gambling fights now in court. "Our goal is to help set a higher standard for market integrity, product design and investor protection by offering access through a regulated securities exchange," said Rob Hocking, Cboe's global head of derivatives.

Why now

Cboe is entering a booming sector. Open interest across prediction markets recently hit a record $1.48 billion, drawing brokerages and tech firms alike. Polymarket and Kalshi lead today, while Robinhood and Coinbase have added prediction-market trading and Meta is reportedly planning an app called "Arena," which Boursel has covered.

For Cboe, the launch extends a familiar product line. "Following the success of SPX 0DTE options, we have seen continued customer demand for shorter-dated, outcome-based trading," said JJ Kinahan, the firm's head of retail expansion, referring to the popular same-day-expiry options Cboe already runs. The timing was pointed: Cboe's debut coincided with the CFTC suing Kentucky in defense of the event-contract model — a fight Boursel reported on earlier.

Availability and signal

The contracts are live on Interactive Brokers, with a Charles Schwab rollout expected in coming months and more brokerages anticipated over time. The broader signal is that prediction-style trading is going mainstream — moving from crypto-native startups onto a 50-year-old regulated exchange. Whether that resolves or sharpens the gambling-versus-investing debate remains unsettled. This article is informational and is not investment advice.