Product
Block Trade
Reviewed by iGaming Times editorial teamLast reviewed 24 September 2026
What is Block Trade?
A large transaction negotiated privately away from the order book and then reported to the exchange, available only to eligible participants such as financial institutions, regulated insurers, funds and parties above an asset threshold.
Key takeaways
- A block trade is a large transaction negotiated away from the order book and reported to the exchange afterwards.
- Eligibility is limited to institutions such as financial firms, regulated insurers and funds, and parties above an asset threshold.
- Insurers have used prediction market blocks to hedge sporting bonus liabilities, the clearest case for event contracts as hedging.
Why it matters
Block trades exist because executing a very large order through a public order book moves the price against the person doing it. Negotiating off exchange and reporting afterwards gives size without that penalty, and the eligibility threshold keeps retail participants out of a mechanism designed for institutions.
In prediction markets the block trade tier has become the clearest evidence that event contracts can do real economic work. Insurers carrying contingent liabilities that vary with sporting outcomes, such as performance bonuses owed by clubs and universities, have used blocks to lay off that exposure, structuring several legs to match a payment schedule. That is hedging in the ordinary sense, performed by a regulated counterparty against a genuine underlying risk.
It also draws an awkward line through the sector. The hedging justification applies to the institutional tier and says very little about a retail customer trading a short-dated contract with no underlying exposure at all.
The bottom line
A block trade is how institutions transact size without moving the market. Where prediction markets are concerned, it is also where the hedging argument is strongest and narrowest.
Sources
Frequently asked questions
What is a block trade?
A block trade is a large transaction negotiated privately between two parties away from the public order book and then reported to the exchange. It exists because pushing a very large order through the book would move the price against the trader. Negotiating off exchange lets institutions transact size without that penalty, while reporting keeps the trade within the exchange's rules.
Who can make block trades on prediction markets?
Block trading is restricted to eligible participants rather than retail customers. On prediction markets these are typically financial institutions, regulated insurance companies, investment funds and people or organisations above an asset threshold set in the exchange's rules. The restriction keeps a mechanism designed for institutional size away from ordinary account holders.
Why do block trades matter for prediction markets?
They are the clearest evidence that event contracts can do real economic work. Insurers carrying liabilities tied to sporting outcomes, such as performance bonuses owed to coaches, have used block trades to lay off that exposure. That is hedging by a regulated counterparty against a genuine risk, although the argument says little about retail customers trading short-dated contracts with no underlying exposure.