Prediction Markets Reach 27% of US Sports Bets During World Cup

Prediction-market trading volume surged to approximately 27% of all legal US sports-betting activity during the recent World Cup, a substantial increase from 9% at the start of the year, according to H2 Gambling Capital. This growth significantly outpaced that of traditional sportsbooks, highlighting the competitive challenge posed by companies such as Kalshi and Polymarket. Kalshi, a leading prediction market platform, repeatedly broke its own trading records throughout the tournament, reaching volumes nearly 10 times higher than earlier in the year. During the World Cup, Kalshi's mobile app attracted more daily users than major US online sports-gambling apps DraftKings and FanDuel, as reported by Apptopia. This shift in user engagement indicates a changing competitive landscape, prompting traditional sportsbooks to consider offering similar prediction-market services. Analysts like Ian Moore of Bernstein noted this growth as a "new opportunity for everyone" and a catalyst for traditional operators to adapt. Less than two years prior, prediction markets were largely prohibited from offering wagers on sports games. Initially dismissed by gambling executives as fringe operations facing regulatory hurdles, prediction markets have gained traction due to a more favorable regulatory environment. The Commodity Futures Trading Commission (CFTC) has permitted these exchanges to launch a variety of betting products, enabling them to successfully navigate legal challenges from state regulators seeking to prohibit their operations. This regulatory backing has been crucial for platforms like Kalshi and Polymarket to demonstrate their viability and expand their market share within the broader sports-betting industry.