What Is a Compulsive Behavior?

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Modern betting platforms are attractive and designed to hook users.

The psychology behind the attractiveness of betting is an important feature in its appeal.

Intermittent rewards, overconfidence and the illusion of skill, and fast feedback are critical factors.

In 2026, people are more empowered than ever when it comes to placing financial bets. Each year, millions of people bet on sports, make wagers in prediction markets about political events, or try their hand at day trading of stocks or cryptocurrency. Modern financial tools like Robinhood for trading digital investments allow people to buy and sell assets immediately and frictionlessly. New prop-bet platforms like Polymarket allow people to place bets on a plethora of different uncertain outcomes, including who will win an election or whether the price of Bitcoin will go up or down in the next five minutes.

Why lump all of these things together? Because people tend to lose money on average, in all of them. Casinos for traditional gambling, Robinhood for day trading, and Polymarket for prop bets are all profitable because the house generally wins. Although investing overall is generally profitable, 97% of day traders fail to outperform a general market index (e.g., S&P500), and many lose money over time. And the underlying psychology behind these seemingly irrational betting/gambling/investing platforms is the same. Following are three psychological reasons why people love betting.

1. Intermittent Rewards Are Powerful

One of the most well-established findings in psychology is the concept of intermittent reinforcement—defined as a schedule under which rewards are given out randomly or inconsistently—in driving repeated behavior. The inconsistent nature of this mechanism creates excitement in the uncertainty about the outcome. A clear example comes from slot machines, in which players lose money on average yet randomly win occasionally, thus reinforcing the behavior. Slot machines have the feature of an arm which the user pulls, creating the illusion of control over your outcome and feeding into the addictive psychology of the behavior powered by intermittent reinforcement.

When we know for certain that we will be rewarded for doing something, we tend to do the behavior, although reinforcement may be lower since the outcome is predictable and lacks excitement or uncertainty. When we know for certain that we will not be rewarded for behaving in some way, behavior will quickly cease. However, when rewards are given sporadically for the same behavior, we are particularly intrigued to keep working for a reward. Gambling, day trading, and prop bets all have intermittent reinforcement as a backbone feature feeding behavior due to the uncertainty of whether you will win or lose. Typically, winning happens occasionally while losing happens more often, creating more excitement when a win occurs.

2. Overconfidence and the Illusion of Skill

Overconfidence in one’s abilities is a core feature of gambling. In a podcast by comedian Bill Burr discussing the topic, he made a sarcastic claim about sports betting along the lines of, “When I make a sports bet, do I believe I know more than the combined information of the experts, the statisticians, and the algorithms worth millions of dollars which the bookmakers use to make the odds? Of course I do!” He is not alone: Whenever someone places a bet or accepts a wager, you can read between the lines and essentially say that they are overconfident relative to the odds. But this logic goes out the window if the player gets lucky and wins their bet.

Overconfidence, paired with the intermittent reinforcement of wins, leads bettors to feel the illusion of skill. When they win, all of the thoughts and feelings which led to the bet are validated, convincing the bettor that they were logical instead of lucky. On the other hand, losses are chalked up to bad luck or something which can be learned from to improve one’s bets in the future rather than a rational acceptance of the reality that, on average, the house wins.

3. Real-Time Feedback Loops

Swift feedback is the third and final key feature of modern betting vehicles. Day trading an asset with constant price fluctuations, or placing a prop bet on whether the price of Bitcoin will increase or decrease in the next five minutes, provides the user with immediate feedback on their performance. It captures the user’s attention through the need for constant checking of odds, prices, or probabilities, which can increase engagement or entertainment. Constantly checking the price of a volatile asset like Bitcoin all day creates a vicious emotional roller coaster for the bettor, which may direct the behavior toward becoming compulsive over time. Wins are celebrated and aim to be replicated, whereas losses must be corrected by doubling down and winning the money back.

What Is a Compulsive Behavior?

Take our Do You Know the Facts About BFRBs?

Find an Obsessive-Compulsive (OCD) Therapist

Modern gambling has given people a wider and deeper net for placing bets on virtually anything they wish. Gamification has increased the appeal of betting websites and apps, providing users with a frictionless interface with an engaging user experience and offering immediate feedback. Just as social media platforms have become more gamified and addictive as the algorithms have developed over time, financial and prop betting platforms will likely follow suit. Applying the lens of classic psychology to modern betting may help explain why people are so hooked on making financial wagers—and show us how users can avoid falling prey to their allure.

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