Commentary: Betting on war? Why prediction markets like Kalshi and Polymarket are a problem
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Who hasn’t had the experience of hearing some know-nothing proudly display his ignorance — whether in a bar, on a crowded plane or on Joe Rogan’s podcast?Increasingly, thanks to the explosive growth of prediction markets such as Kalshi and Polymarket, every misinformed or malinformed blowhard has an arena to capitalize on his or her pontifications by placing bets on whether they will come true.So do well-informed experts and, more troubling, insiders with the ability to manipulate the betting markets that are proliferating so rapidly.Kalshi is replacing debate, subjectivity, and talk with markets, accuracy, and truth.— Kalshi CEO Tarek Mansour, claiming that his marketplace has a window on the wisdom of crowdsMany people object to users’ ability to bet on death and destruction — such as the assassination of foreign leaders or the outbreak of war.
The Biden administration was preparing regulations forbidding such wagering, but its initiative was canceled by the Trump administration.The prediction market’s critics raise two more concrete concerns about its growth: It’s vulnerable to manipulation by anonymous insiders, and it risks exacerbating problem gambling, especially among young men who are among the targets of the companies’ promotional pitches.Commentary on economics and more from a Pulitzer Prize winner.
By continuing, you agree to our Terms of Service and our Privacy Policy.Before diving deeper into these and other consequences of the explosion in event betting, a few words about how these markets work.Put simply, they pose questions that can be reduced to simple choices of “yes” or “no”; the choices made by users are updated in real time.
Among the bets currently designated “trending” on the Kalshi website, for instance, is the identity of the next Democratic presidential nominee.California Gov.
Gavin Newsom leads the pack with 27% of bett...