The prediction market election

Prediction markets roil midterm election season

The significant boom of prediction markets is pushing U.S. elections into uncharted territory, prompting concern and scrutiny about the risks of betting on political outcomes.

© The Associated Press

Kalshi, Polymarket and other platforms process trading volumes in the tens of billions of dollars each quarter as users bet on world events, from sports and pop culture to which party will win the House this fall and whom Democrats will pick for president in 2028.

Some election observers even look to the markets as key tools alongside polling for analyzing races and issues. 

But the surge in prediction markets’ popularity has also ushered in a new wave of skepticism and concerns about how political betting could impact elections, whether through insider trading or the gamification of politics more broadly. 

“It’s the wild west right now,” said Geoffrey Skelley, chief elections analyst at Decision Desk HQ. “We’re in real new territory, and it’ll be interesting to see how state and federal governments and others respond to it.”

The popularity of prediction markets has exploded since 2024, when a federal court ruled the Commodity Futures Trading Commission (CFTC), the small financial regulator monitoring derivatives markets, couldn’t block betting on the outcomes of federal elections. 

With the click of a button, bettors can buy shares on potential outcomes — and then reap a payout if that outcome occurs. When it comes to politics, proponents of prediction markets argue........

© The Hill