The 'casino-ization of everything'
Prediction markets such as Kalshi and Polymarket, sites where people can bet on virtually anything, now are an "unavoidable presence" in American politics and culture, says The New York Times.
Users can bet on the outcomes of events in everything from politics and world news to pop culture and sports, says CNBC. From the Oscars to local temperatures, says The Wall Street Journal.
Another Times article says there are thousands of questions, live around the clock, on which anyone can take a side.
The article focuses on Joel Holsinger, 26, who quit his job as a corporate CPA to trade full time in prediction markets. After two months, he was “well along the road to making his first $100,000,” the Times says.
Last Thanksgiving, Holsinger bet on whether President Trump would say the word “stuffing” during the annual turkey pardon.
Prediction markets are quickly filling a gap in the market in states where online sports betting isn’t legal, says CNBC. And in states where it is legal, online sports betting often is limited to people 21 or older. Kalshi and Polymarket are open to anybody 18 or older, with some state-by-state exceptions.
“Making a living betting on prediction markets just might be one of those era-defining occupations — like being a Wall Street trader in the 1980s, a dot-com founder in the 1990s or an influencer in the 2010s,” says the Times.
“There are the young men increasingly drawn into screens and online communities; the breakdown of traditional career paths, and the rise of make-your-bag YOLO-ing into highly speculative investments; the post-trust, post-expert epistemics of mathematical probability and the wisdom of crowds; the contemporary casino-ization of everything,” the Times says. “They may have found their ultimate confluence in the full-time predictions trader.”
In December, early $12 billion was traded on Kalshi and Polymarket, up more than 400 percent from a year earlier, according to data from Piper Sandler, an investment bank.
There's now enough volume and liquidity that a top trader can make into the millions of dollars a year, the Times says.
Donald Trump Jr. is an investor in Polymarket and an adviser to Kalshi. And Truth Social, Trump’s social media network, is launching its own prediction market that it says will offer trading related to elections, interest rates, sporting events and more, The Washington Post reports.
“We’re democratizing information and empowering everyday Americans to harness the wisdom of the crowd, turning free speech into actionable foresight,” says Devin Nunes, chairman and CEO of Trump Media.
The sites have raised concerns about market manipulation and insider trading. Hours before the U.S. military captured Venezuela President Maduro, an anonymous user on Polymarket bet tens of thousands of dollars that Maduro would fall, fueling speculation that a government official had placed the bets using confidential information about the military plans.
The trader's payout was $410,000.
Proponents of prediction markets say they can offer valuable insights on the economy, markets and more by channeling the wisdom of crowds, and are often more accurate than polls, the WSJ says. But some worry about the long-term effects of making betting pervasive.
Several states are battling the prediction markets in federal courts, saying the sites should be required to follow rules that apply to traditional gambling companies.
New York Attorney General Letitia James issued a consumer alert on Monday warning consumers of the “potential harms of sports betting and prediction markets.”
NCAA President Charlie Baker wrote last month to the Commodity Futures Trading Commission, which regulates prediction markets, asking the agency to remove college sports from options to trade until more safeguards are in place.
An academic study published in December found a correlation between easy access to sports gambling and significant declines in credit scores and increases in bankruptcies, indebtedness and missed loan payments.
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