Polymarket Volume Is Exploding -- but the Real Money Might Be in This Tiny Sports Data Duopoly Stock.

Prediction markets are having something of a breakout moment. Polymarket, the decentralized event trading platform, recorded $10.57 billion in monthly volume in March -- the first time it crossed the $10 billion threshold in a single month. Meanwhile, its total volume for the first quarter of 2026 hit $26.2 billion, up more than 90% from the prior quarter.

A single-day record on Polymarket of $425 million was set in February, surpassing even the frenzy of Election Day 2024. The Commodity Futures Trading Commission's decision to grant Polymarket a no-action letter and to allow it to resume doing business in the U.S. has dramatically accelerated that growth. Wall Street has noticed. NYSE parent company Intercontinental Exchange disclosed plans for a $2 billion investment in Polymarket at an $8 billion valuation in late 2025. The prediction market category is becoming institutionalized and normal. I use prediction markets. Many of my peers use them.

Image source: Getty Images.

Genius Sports is a hidden bet on sports betting

None of that money flows directly into a publicly traded vehicle through Polymarket. But some of it does flow -- almost inevitably -- through Genius Sports Limited (NYSE: GENI). Genius Sports is not a betting company, a bookmaker, or a prediction market. It's the company that businesses in those categories depend on to function. Genius Sports holds exclusive or semi-exclusive official data rights from major sports leagues, including the NFL, NBA, English Premier League, and NCAA, among others.

But when a sportsbook or prediction market wants to settle a live bet -- the score at the end of the second quarter, the number of passing yards on a given drive, whether a specific player scored -- it needs real-time, official data it can trust. That's often provided by Genius Sports.

Its chief rival in this market is Sportradar (NASDAQ: SRAD), which holds official data rights with the NBA, MLB, NHL, and FIFA, among others -- and is faring considerably better in the market: Sportradar posted record full-year 2025 revenue of 1.29 billion euros (about $1.5 billion) and its stock has held up far better than Genius Sports' so far in 2026.

In 2025, Genius Sports generated $669.5 million in revenue, up 31% year over year. Q4 2025 revenue alone grew 37% year over year to $240.5 million. The company projects $810 million to $820 million in organic revenue in 2026 -- and separately guided that its pending Legend acquisition, which should close by the end of this quarter, would bring total 2026 revenue to $1.1 billion.

The prediction market angle

Here's where it gets interesting for investors watching Polymarket's rise. Prediction markets that settle on real-world sports outcomes need official data with provable integrity, not scraped stats or aggregated third-party feeds. The Commodity Futures Trading Commission has already signaled that it sees official sports data as a framework for legitimate settlement in event markets. That's a direct regulatory tailwind pointing toward companies like Genius Sports that already hold those rights.

The company's media technology segment -- which includes programmatic advertising tied to live game moments through its "Moment Engine" platform -- grew 37.9% in 2025. Genius Sports expanded its Moment Engine across partners representing roughly 90% of the programmatic advertising ecosystem, including activation during the Super Bowl. That advertising arm is an often-overlooked revenue driver that is completely separate from betting.

Analysts' consensus 12-month price target for the stock is roughly $8.60 -- more than double its current price of around $4.25.

Investors looking at Genius Sports need to be clear-eyed about the risk: The stock is down roughly 61% in 2026, its losses widened to $111.6 million in 2025, and a sharp earnings miss in Q4 shook confidence in a business that is still firmly in investment mode.

But if prediction markets continue to expand, the company controlling the official data rails will become an asymmetric bet. With rights, revenue momentum, and platform leverage in place, the real question is whether Genius Sports can execute before the market runs out of patience.

Micah Zimmerman has no position in any of the stocks mentioned. The Motley Fool recommends Genius Sports and Intercontinental Exchange. The Motley Fool has a disclosure policy.