The introduction of prediction markets such as Polymarket and Kalshi are exploding in popularity. At the same time cryptocurrency trading seems to be falling off a cliff. Are the two connected?

“Crypto is so yesterday,” said one Gen Z trader, in response to my question. Younger investors are turning their attention to platforms where users can trade contracts on the outcome of future events. Today, one can bet on everything from the outcome of the midterm elections to when the next Fed interest rate cut will occur. Not only can you bet on political or cultural events but increasingly on sports and…