Wall Street Infrastructure Comes to Prediction Markets | Markets Outlook

**Austin Federa** (0:00)
There's been these stories about ice cream shops betting against the weather for, because sales of ice cream are very closely correlated to, is it 90 degrees, or is it 60 and rainy?
And this feels like on one level, oh, we're financializing everything. On another level, yes, we should be. This is exactly how efficient markets work.

**Jennifer Sanasie** (0:27)
Introducing RealFi, a smarter stablecoin that's backed by real world assets. Launching August 2026, join the Testnet now at realfi.co. Austin Federa, welcome to Markets Outlook.

**Austin Federa** (0:39)
Thanks for having me.

**Jennifer Sanasie** (0:40)
Thanks for being here. It's wonderful to see you again.

**Austin Federa** (0:42)
You too.

**Jennifer Sanasie** (0:43)
All right. I usually start the show by asking folks what they're watching this morning, but some big news broke yesterday concerning you and DoubleZero. So I'll let you talk about it. And talk to me about the reaction online. Is it the reaction you expected to get from people? A lot of people say, finally, we have this infrastructure that's going to catapult us into the next generation of financial markets. But I'll let you tell me about the reaction.

**Austin Federa** (1:07)
Yeah, certainly. So what we announced yesterday is a really exciting thing with Kalshi and Kalshi Research, which is that we're bringing fast market data feeds from the world's largest CFTC-regulated production market to DoubleZero Edge for the first time. And what this really means is, right now, the way that every trader, whether they're in a retail trader going in through the app, or they've got an AI agent that's doing stuff for them automatically, they're going in using the same type of technology that you use to get updates from Facebook or notifications of new tweets. It's not the type of technology that Wall Street uses, and it's technology that was never really built for high performance finance. And the rise of prediction markets, especially Kalshi, has gotten us to a point where this is core financial infrastructure, not just for traditional finance, but obviously new finance as well.
And so what DoubleZero announced with Kalshi yesterday is that you can now get full layer one and layer two data for the entire Kalshi sports category book, as well as the CryptoPerps book delivered over multicast. And so what this means for traders is they can watch every single instrument and every event contract that's trading on sports as well as CryptoPerps in real time. They've previously had sort of pick and choose what they wanted to watch. This is all also delivered over a low latency global fiber network. So it's much faster than the public internet where most people are consuming data today.

**Jennifer Sanasie** (2:30)
You mentioned that Wall Street has been using this type of infrastructure for a long time.
Why do you think and I say why do you think it took so long? Because things feel like they move the speed of lightning in this industry. But why do you think it took so long to bring this infrastructure over to crypto?

**Austin Federa** (2:46)
There's kind of two or three different reasons for this. So primarily, this infrastructure is very hard to build, and it's actually like a skill set that is not common among Web2 engineers. Web2 in the cloud revolution was incredible for social media, web apps, Uber, DoorDash, the types of things we use on our phone every day, Slack. But financial infrastructure operates in a very different way. If you go to the data centers that the New York Stock Exchange runs in, it looks nothing like the type of environment that Facebook is hosted on or your average Web2 application is. And so there's a real technology and skills gap. And the second one is for a long time, new finance and crypto and production markets was sort of a weird thing outside of the traditional markets. These were markets created by people who were believing in an alternative to the traditional financial system. And as such, you know, it didn't make sense to invest in the type of professional infrastructure that you see in Wall Street and traditional financial markets. But as we've seen prediction markets, especially become really key components, not just of traditional finance, but this whole category of new finance as well. There's all these new opportunities. And quite frankly, the TAM is big enough, the pie is big enough, the market's big enough that there is now a demand for the same type of high performance data that you see on Wall Street for equities and commodities.

**Jennifer Sanasie** (4:10)
All right, we're going to take a quick break when we come back ships on chain and more with Austin Federa. This episode is brought to you by RealFi.