Essential Information About Prediction Markets: Frequently Asked Questions

Emergence of Prediction Markets: Prediction markets are gaining traction as dynamic platforms for trading event outcomes, such as elections and sports, with major players including Kalshi and Polymarket.

Market Growth and Regulatory Landscape: The U.S. prediction market has seen significant growth, particularly after a court victory for Kalshi, but faces regulatory risks with pending cases in several states.

Market Potential: Prediction markets currently represent 3-8% of the U.S. online sports betting market, with potential to exceed $1 trillion, particularly in sports betting.

Financialization of Betting: Analysts warn that unchecked growth in prediction markets could blur the lines between gambling and financial trading, raising concerns about regulatory oversight.