Wall Street financial behemoth Goldman Sachs (GS.US) returned to the top of the revenue rankings for Wall Street's equity capital markets (ECM) in the last quarter of last year. Goldman's ascent to the number one position comes as major banking giants on Wall Street vie for underwriting roles in large-scale projects expected to conduct initial public offerings (IPOs) on the U.S. stock market by 2026, including companies like OpenAI, Anthropic, and SpaceX. Furthermore, Goldman Sachs is closely monitoring significant investment opportunities in the realm of Prediction Markets, aiming to capitalize on these rapidly growing platforms that allow betting on real-world events and striving to become a player akin to platforms like Polymarket.
The New York-based financial giant reported that its equity underwriting revenue for the final three months of 2025 was approximately $521 million, surpassing the comparable business revenues of Morgan Stanley ($494 million) and JPMorgan Chase ($416 million). The volume of global capital market investment activity specifically grew for the fourth consecutive year; according to one compiled institutional statistic, the aggregate total for global IPOs, equity sales volume, and convertible bond activity surged to a staggering $841.8 billion, although this figure still represents just over half of the record amount set in 2021.
David Solomon, CEO of Goldman Sachs, indicated that this figure (the Q4 2025 equity underwriting revenue data) is unlikely to be surpassed in the short term. As shown in the accompanying chart, Goldman led Wall Street in fourth-quarter equity underwriting business. "I suspect the overall level of equity capital markets in 2026 will still be significantly below the 2021 peak, but slightly higher than this year's level, though predicting quarterly levels precisely is difficult," Solomon told analysts on the bank's earnings call Thursday.
Goldman Sachs capped off 2025 with a major achievement, playing the lead role in the $7.2 billion listing of U.S. healthcare giant Medline Inc., which was the largest IPO in the U.S. market that year and the biggest since Porsche AG's listing in 2022. Including so-called over-allotment options, the 47 major commercial banks involved in the Medline offering shared $156.5 million in fees, with over one-third of that going to the equity underwriting syndicate led by Goldman Sachs and Morgan Stanley.
Despite handling some large-scale IPO projects in the U.S., Europe, and India, along with a busy wave of convertible bond issuances, the overall revenue growth in equity capital markets for both Goldman Sachs and Morgan Stanley compared to the fourth quarter of 2024 remained only in the single-digit percentage range. In terms of full-year 2025 performance, Morgan Stanley performed most strongly, boosting its full-year equity capital markets revenue by a substantial 23% to $1.97 billion.
"Equity capital issuance, primarily driven by convertibles and IPOs, remains robust, fueling consistent market performance for equity underwriting businesses," Morgan Stanley Chief Financial Officer Sharon Yeshaya told analysts on the earnings call Thursday local time.
Institutional investors in financial markets widely anticipate 2026 to be a breakthrough year for equity capital markets business, as some of the largest private tech companies, particularly Elon Musk's global space exploration leader SpaceX, consider going public as early as this year. "We have a lot of large companies in the queue, and I think for a variety of reasons, they are reaching an inflection point, deciding, you know what, it's time for us to go public," Goldman Sachs CEO Solomon said on the earnings call. He also expects that large private equity firms may bring more of their portfolio companies to public trading markets like U.S. stocks.
Goldman Sachs is exploring an entry into prediction markets and studying how to fully benefit from this rapidly growing but relatively lightly regulated market, the Wall Street giant's CEO said on Thursday. "We have a team here spending time working with them and delving into research in this area," Solomon emphasized on the firm's fourth-quarter earnings call. Over the past two weeks, Solomon personally met with the leadership of two major prediction market companies (Polymarket and Kalshi) and "spent several hours with each company to deeply understand prediction markets."
Undoubtedly, Goldman's entry into prediction markets would pit the financial behemoth against Robinhood Markets (HOOD.US), a favorite retail trading app among U.S.散户 investors; Robinhood's stock closed down significantly, 7.79%, on Thursday, partly as some investors began questioning: if Goldman Sachs—one of Wall Street's largest investment banks—enters this space, how can Robinhood compete and maintain its growth momentum in this area? Solomon stated that he sees potential for prediction market contracts regulated by the Commodity Futures Trading Commission (CFTC) to "intersect with our business," but he cautioned that the pace of specific prediction market developments might be slower than some investors expect.
"Prediction markets" have gained global popularity since the end of the 2024 U.S. presidential election, when nearly everyone was eager to place real-money bets on platforms like the paid prediction market platform Polymarket regarding whether Trump or Harris would win the U.S. presidency, signaling the arrival of an era where "everything can be wagered on." What exactly defines a "prediction market company"? Essentially, they are trading platforms that turn real-world events into tradable binary contracts: contracts typically settle on a "yes/no" basis (e.g., whether an event occurs), and their prices can be interpreted as the market's pricing of probability; in the U.S. context, these contracts are often packaged as regulated derivatives called "event contracts."
Undoubtedly, the introduction of related contract trading by important channels with large investor bases like Robinhood, and the entry of traditional giants like ICE and CME through investments or new platforms, has significantly boosted the entire prediction industry's credibility and user reach. Prediction markets切入 sports through "event contracts," attracting trading volume even in states without legal sports betting, thus becoming a major source of growth for platforms like Kalshi to date, while also sparking state-level compliance controversies and attention.
More significantly, some Wall Street investment firms and professional trading funds have begun using them to bet on/hedge the probability of macro and corporate events (like Federal Reserve monetary policy, success/failure of large mergers and acquisitions), because the binary contract structure offers a "purer" expression. An analyst team from the well-known Wall Street financial institution Citizens Financial Group Inc. stated in a research report that prediction market companies like Polymarket could see their collective revenue grow to a whopping five times the current market size by 2030, reaching a super-scale exceeding the $10 billion revenue mark.
Statistical data shows that globally known paid prediction companies like Kalshi Inc. and Polymarket have recently seen a surge in trading volume on their event-based contracts; these contracts provide a regulated, paid way to bet, allowing people to wager using methods like the stablecoin USDC on major sports, political, and cultural events—for instance, Polymarket gained global popularity during the 2024 U.S. presidential election with its exclusive prediction market ecosystem.
Devin Ryan and his team of market analysts from Citizens estimate the industry's current annual revenue is approximately $2 billion. They believe that at Robinhood Markets Inc., the global散户-favorite internet securities trading platform that offers Kalshi contract trading, this prediction business is the fastest-growing product in terms of user expansion in the internet brokerage platform's history and already contributes about 10% of the company's revenue.
"Prediction market companies" typically refer specifically to platforms like Kalshi and Polymarket that offer trading in "event contracts." Other players frequently mentioned/entering the same arena recently include Crypto.com (partnering with Kalshi to promote industry lobbying efforts) and Gemini, which just received U.S. regulatory approval to advance its prediction market business; meanwhile, traditional exchanges/sports betting operators are also accelerating their entry (e.g., a new trading platform jointly created by CME and FanDuel, ICE's investment in Polymarket).
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