22 Jan 2026

Place your bets on betting

Place your
bets on betting

Who will win the best picture Oscar this year? Who will be the next US president? How many tweets will Elon Musk post in 2026?

You can now potentially make money out of guessing the answers
to all of the above.

You can now potentially make money out
of guessing the answers to all of the above.

You can now potentially make money out of guessing the answers to all of the above.

“A prediction market is like the stock market, but instead of buying and selling companies, you’re buying ‘yes’ and ‘no’ on whether something is going to happen
or not.” That’s according to Tarek Mansour and Luana Lopes Lara, the founders
of Kalshi (one of the two big players in this space alongside Polymarket).

Prediction markets aren’t a new thing. They have existed since the late 80s, but until recently, the Commodity Futures Trading Commission (CFTC) only allowed them
to exist for educational and research purposes.

Today, Kalshi’s CEO is saying “the long-term vision is to financialize everything
and create a tradable asset out of any difference in opinion.”

These companies do loads of advertising and they’re trying hard to position themselves as different from gambling. They argue that the difference is that
with gambling you bet against the house, and in a prediction market you put your money on an opinion, against the people that make the opposed bet, and the platform takes a percentage of the winner’s gains.

Since early 2024, prediction markets’ volume has skyrocketed from $100 million
to $13 billion per month according to Keyrock and Dune Analytics, and the owner
of the New York Stock Exchange, Intercontinental Exchange, has recently invested
$2 billion on Polymarket.

Proponents of these platforms are calling them “truth machines” fueled by the “wisdom of the crowds.“ The argument is that prices are a better indicator of what
is going to happen than polls or other methods. (Polymarket did predict the winner
of the last US election earlier than most reputable news outlets.)

“A prediction market is like the stock market, but instead of buying and selling companies, you’re buying ‘yes’ and ‘no’ on whether something is going to happen or not.” That’s according to Tarek Mansour and Luana Lopes Lara, the founders of Kalshi (one of the two big players in this space alongside Polymarket).

Prediction markets aren’t a new thing. They have existed since the late 80s, but until recently, the Commodity Futures Trading Commission (CFTC) only allowed them to exist for educational
and research purposes.

Today, Kalshi’s CEO is saying “the long-term vision is to financialize everything and create a tradable asset out of any difference
in opinion.”

These companies do loads of advertising and they’re trying hard
to position themselves as different from gambling. They argue that the difference is that with gambling you bet against the house,
and in a prediction market you put your money on an opinion, against the people that make the opposed bet, and the platform takes a percentage of the winner’s gains.

Since early 2024, prediction markets’ volume has skyrocketed from $100 million to $13 billion per month according to Keyrock
and Dune Analytics, and the owner of the New York Stock Exchange, Intercontinental Exchange, has recently invested
$2 billion on Polymarket.

Proponents of these platforms are calling them “truth machines” fueled by the “wisdom of the crowds.“ The argument is that prices are a better indicator of what is going to happen than polls or other methods. (Polymarket did predict the winner of the last US election earlier than most reputable news outlets.)

Just like crypto did, prediction markets are branding themselves as disruptive and empowering. There are, however, 4 reasons why they are being heavily criticized:

Unethical bets. There have been bets on Polymarket about whether a famine would be declared in Gaza and about how many acres of forest would burn
in the California fires.
Insider trading. It’s not really fair that one user just happened to make $400,000 betting on Maduro’s capture just before it happened or that a Google employee made $1,2 million on 22 different Google related bets with super low odds. These platforms aren’t under the same scrutiny as the stock market and Kalshi and Polymarket have come out and argued that insider trading is actually beneficial for everyone. Considering Donald Trump Jr. is on Polymarket and Kalshi’s advisory boards and that Trump Media is soon launching its own prediction market, it doesn’t look like they will be more tightly regulated any time soon.  
The wisdom of a very specific crowd. A single trader may often influence prices intended to reflect collective wisdom because the markets are thin. Plus, you have to consider the fact that there’s a specific type of people that bet on these apps, which Max Read in conversation with Galaxy Brain characterized as “young,” “male,” and “stupid.”  
(Malleable) self-fulfilling prophecies: Dow Jones (owner of the Wall Street Journal) struck a deal with Polymarket and Kalshi made deals with CNN and CNBC. The CEO of Robinhood (which has also started a prediction market feature) has said “I like to think of prediction markets as the next generation of the news.” We are increasingly seeing prediction market odds on the news and this can create a feedback loop that influences behaviors. In Dustin Gouker’s words for Event Horizon:

Early trades move prices. Prices signal confidence. Confidence attracts attention. Attention feeds coverage. Coverage, in turn, reinforces belief.

Just like crypto did, prediction markets are branding themselves as disruptive and empowering. There are, however, 4 reasons why they are being heavily criticized:

Unethical bets. There have been bets on Polymarket about whether a famine would be declared in Gaza and about how many acres of forest would burn in the California fires.
Insider trading. It’s not really fair that one user just happened
to make $400,000 betting on Maduro’s capture just before it happened or that a Google employee made $1,2 million on
22 different Google related bets with super low odds. These platforms aren’t under the same scrutiny as the stock market
and Kalshi and Polymarket have come out and argued that insider trading is actually beneficial for everyone. Considering Donald Trump Jr. is on Polymarket and Kalshi’s advisory boards and that Trump Media is soon launching its own prediction market, it doesn’t look like they will be more tightly regulated
any time soon.  
The wisdom of a very specific crowd. A single trader may often influence prices intended to reflect collective wisdom because the markets are thin. Plus, you have to consider the fact that there’s a specific type of people that bet on these apps, which Max Read in conversation with Galaxy Brain characterized
as “young,” “male,” and “stupid.”  
(Malleable) self-fulfilling prophecies: Dow Jones (owner of the Wall Street Journal) struck a deal with Polymarket and Kalshi made deals with CNN and CNBC. The CEO of Robinhood (which has also started a prediction market feature) has said “I like
to think of prediction markets as the next generation of the news.” We are increasingly seeing prediction market odds on
the news and this can create a feedback loop that influences behaviors. In Dustin Gouker’s words for Event Horizon:

Early trades move prices. Prices signal confidence. Confidence attracts attention. Attention feeds coverage. Coverage, in turn, reinforces belief.

Just like crypto did, prediction markets are branding themselves as disruptive and empowering. There are, however, 4 reasons why they are being heavily criticized:

Unethical bets. There have been bets on Polymarket about whether
a famine would be declared in Gaza and about how many acres of forest would burn in the California fires.
Insider trading. It’s not really fair that one user just happened to make $400,000 betting on Maduro’s capture just before it happened or that a Google employee made $1,2 million on 22 different Google related bets with super low odds. These platforms aren’t under the same scrutiny as the stock market and Kalshi and Polymarket have come out and argued that insider trading is actually beneficial for everyone. Considering Donald Trump Jr. is on Polymarket and Kalshi’s advisory boards and that Trump Media is soon launching its own prediction market, it doesn’t look like they will be more tightly regulated any time soon.  
The wisdom of a very specific crowd. A single trader may often influence prices intended to reflect collective wisdom because the markets are thin. Plus, you have to consider the fact that there’s a specific type of people that bet on these apps, which Max Read in conversation with Galaxy Brain characterized as “young,” “male,” and “stupid.”  
(Malleable) self-fulfilling prophecies: Dow Jones (owner of the Wall Street Journal) struck a deal with Polymarket and Kalshi made deals with CNN and CNBC. The CEO of Robinhood (which has also started a prediction market feature) has said “I like to think of prediction markets as the next generation of the news.” We are increasingly seeing prediction market odds on the news and this can create a feedback loop that influences behaviors.
In Dustin Gouker’s words for Event Horizon: