Cboe Global Markets confirmed it is developing a new options-based product offering all-or-nothing payouts, a structure that could allow the exchange to compete directly with prediction markets like Polymarket, Kalshi, Robinhood and others and Coinbase.
Cboe, the premier venue for options trading best known for creating the CBOE Volatility Index (VIX), is in early talks with brokers and market makers on how the product would work, The Wall Street Journal reported earlier.
A person familiar with the matter told CoinDesk that while details are still being finalized, the goal is to use a traditional options wrapper to provide a fixed return outcome for a yes-or-no style event contract.
These types of derivatives (sometimes called binary options or fixed income contracts) allow traders to bet on whether a specific event will occur. The contract pays a fixed cash amount if the event occurs. If not, then its stability is zero. This return structure mirrors the mechanics of prediction markets, where users place bets on everything from central bank moves to election results.
CBOE is no stranger to binary options. In 2008, the exchange launched binary call options tied to the S&P 500 and the Chicago Board Options Exchange Volatility Index (VIX), allowing traders to bet on whether the indexes would close above a specific level. But these products struggled to gain traction and were eventually withdrawn from the market.
However, the person told CoinDesk that this new initiative is not intended to directly relaunch these earlier tools. Instead, CBOE appears to be exploring ways to modernize the concept and appeal to a wider range of retail and institutional users. A key focus is delivering a better end-user experience, which may include more intuitive market access or clearer contract terms.
If launched, the product could carve out space in the rapidly growing segment of the derivatives market. Platforms like Kalshi (a CFTC-regulated venue) already offer event-based contracts on macroeconomic outcomes. Polymarket operates on the blockchain and sees transaction volumes surge during election cycles and high-profile geopolitical events. Coinbase (COIN) also recently partnered with Kalshi to launch prediction market trading on its platform.
The exchange has not yet confirmed a timetable and it is unclear what specific events or outcomes the contracts will target.