Over the last few years, “prediction markets” have taken the world by storm. Unlike normal sportsbooks, where customers bet on set events like the Kentucky Derby or the Super Bowl, prediction markets like Kalshi and Polymarket are advertised as the way to bet on “anything.” And yes, they do truly mean anything. If desired, you can bet on the daily temperature high in New York City tomorrow, who will win Survivor Season 50, what the president will say during the state of the union, and even traditional sports bets like money lines and more.
These new prediction markets have exploded both in popularity and trading volume over the last year, and it should be a concern for everyone, even those not using these apps.
The greatest concern is the lack of regulation. Unlike traditional sportsbooks that require 21 years or older to enter, prediction market customers only need to be 18 years or older to gamble. This is because these prediction markets are not players betting against the house, but instead against other players who took the other side of the bet. This distinction is why these apps are legally able to operate, despite having many of the same sports bets that traditional 21+ books have.
The largest issue stemming from the lack of regulation is the insane amount of insider trading that people are getting away with through these markets.
Insider trading typically refers to buying and selling stocks utilizing information not available to the public and has been a federal crime since 1934. However, people are using prediction markets to circumvent these laws and making insane profits.
Last November, on Polymarket, a brand new account was created, and within weeks, they placed three bets totaling $78k for Gemini 3.0 to be released before the end of November. Gemini 3.0 subsequently released on November 18, 2025, and the user made millions. While surely somebody could have the funds and the insanity to gambling with almost $80k without surefire knowledge of when Gemini 3.0 would release, it seems more likely that this was a Google employee who knew when the release was.
This isn’t the only case either. Most recently, days before the “war” in Iran began, over half a billion dollars on Polymarket alone was traded on if the US would attack Iran. This is especially concerning since Donald Trump Jr. is now an advisor for the company. Users were even betting on the dates the president of Venezuela would be captured or the day the head of Iran would be killed. Inside traders in the government are literally making millions by betting on human lives that they have the power to take.
The Gemini 3.0 and Iran examples are just two of the better-known (possible) cases. It all seems like one big party that most people are too poor or don’t know the right people to take advantage of. It makes me wonder why shouldn’t everyone just be taking advantage of it?
It seems pretty easy to find an edge given enough effort. I could become a meteorologist and make a healthy bonus every day by accurately predicting the weather and temperature. Perhaps next year I could go get hired by the NCAA selection committee and bet my life savings on some mid-major who is last in to make March Madness and make hundreds of thousands. With the growing number of possible markets, perhaps by the next time a wildfire breaks through California, they’ll have markets on the value of property damage. Then, all it takes is one sick person to discreetly sabotage relief efforts and let everyone else suffer while they buy a few Laborguinis.
These prediction markets are still relatively young, and people are already making money off war and suffering. As much as I would love to find some devious (borderline illegal) ways to pay off my student loans using these prediction markets, I’d prefer the government stop sitting on their hands and regulate these prediction markets before more harm comes to people.
