Prediction markets such as Kalshi and Polymarket allow people aged 18 and older to buy and sell contracts linked to future events, including election outcomes. The source article says nearly $1.9 billion has been traded on these markets during this election cycle. Federal law prohibits online gambling platforms such as DraftKings and FanDuel from accepting bets on election results.
Supporters distinguish prediction markets from conventional online betting because participants trade contracts with one another, rather than placing wagers against a platform that pays winning customers. Contract prices are presented as reflecting the probability of an outcome, while platforms may charge transaction fees. The article argues that, despite this difference, election contracts function like bets and can carry similar risks.
One concern is the potential for gambling-related harm, particularly among young people. The article says nearly 75 percent of Kalshi’s event contracts involve sports and notes that younger people who begin betting may face a greater likelihood of developing gambling problems. It also argues that changing contract prices can encourage users to keep checking platforms and making trades as new information or public sentiment shifts.
The article also raises concerns about how people use market prices. Because those prices can be informed by artificial intelligence processing large amounts of data, participants may follow the implied probabilities instead of assessing evidence independently, it argues. The author describes this as a form of relying on the crowd’s apparent judgment.
A further concern is that trading on election outcomes could turn civic participation into a form of entertainment or competition. The article contends that focusing on the likelihood of a candidate winning may distract from voters’ consideration of candidates’ character and policies. It also warns that personal financial stakes could lead some participants to prioritize a potential payout over the broader consequences of an election.
The article concludes that election-related prediction markets may affect individuals, voter engagement and the common good, framing the practice as a risk to democracy as well as a potential source of gambling-related harm.
Sources: Psychology Today.