Cboe Global Markets confirmed that it is developing a new options-based product offering all-or-none payouts, a structure that could put the exchange in direct competition with prediction markets like Polymarket, Kalshi, Robinhood and Coinbase.

Cboe, the primary venue for options trading and famous for creating the Cboe Volatility Index (VIX), is in early talks with brokerages and market makers about how the product would work, according to an earlier WSJ report.

While details are still being finalized, the goal is to use a traditional options wrapper to deliver fixed-return outcomes on yes-or-no style event contracts, a person familiar with the situation told CoinDesk.

These types of derivatives — sometimes referred to as binary options or fixed-return contracts — allow traders to wager on whether a specific event will occur. If the event happens, the contract pays out a fixed cash amount. If not, it settles at zero. That payoff structure mirrors the mechanics of prediction markets, where users bet on everything from central bank moves to election results.

Cboe is no stranger to binary-style options. In 2008, the exchange launched binary call options tied to the S&P 500 and the Cboe Volatility Index (VIX), allowing traders to bet on whether those indexes would close above a certain level. But the products struggled to gain traction and were eventually delisted.

This new initiative, however, is not intended as a direct relaunch of those earlier instruments, the person told CoinDesk. Instead, Cboe appears to be exploring ways to modernize the concept and appeal to a broader base of retail and institutional users. A key focus is delivering a better end-user experience, possibly with more intuitive market access or clearer contract terms.

If launched, the offering could carve out space in a fast-growing segment of the derivatives market. Platforms like Kalshi, a CFTC-regulated venue, already offer event-based contracts on macroeconomic outcomes. Polymarket, operating on a blockchain, has seen surging volumes during election cycles and high-profile geopolitical events. Coinbase (COIN) also recently launched prediction markets trading on its platform in partnership with Kalshi.

The exchange has not yet confirmed a timeline, and it remains unclear which specific events or outcomes the contracts would target.