Gambling addicts are struggling as prediction markets such as Kalshi and Polymarket explode in popularity across the United States, with experts warning that these platforms, though not regulated as gambling, are just as addictive. Users risk significant financial losses, with one recovering addict stating, 'You could be betting your rent away.'
Personal Stories of Addiction
Kevin, a 36-year-old law enforcement officer in Texas, has battled gambling addiction for 18 years. The problem cost him his first marriage and led to bankruptcy. Despite sports betting being illegal in Texas, Kevin used an out-of-state bookie until his wife intervened. He then turned to Kalshi, convincing himself and his wife it was akin to stock trading. 'I kind of swindled her into saying Kalshi was like stocks,' he admitted. Within a year, he lost an estimated $5,000 to $10,000, severely impacting his family's finances.
How Prediction Markets Work
Kalshi allows over 5 million monthly users to wager on outcomes in pop culture, politics, weather, and sports. Competitor Polymarket operates similarly. These platforms profit from trading fees, not from user losses, a distinction they emphasize. However, critics argue the difference is meaningless. Benjamin Schiffrin of Better Markets stated, 'The prediction market platforms may take umbrage at the idea that they’re gambling platforms. The rest of the world needs to recognize that they are.'
Regulatory Gaps
Unlike sportsbooks, which are regulated by state gambling commissions, prediction markets fall under the Commodities Futures Trading Commission (CFTC). Kalshi is available in all 50 states to users aged 18 and older. Polymarket returned to US markets last week after a 2022 CFTC fine. Public health advocates and state lawmakers are increasingly concerned. Lia Nower, director of Rutgers University’s center for gambling studies, warned that unregulated markets will likely contribute to rising problem gambling rates.
Addiction Statistics
Nearly 20 million Americans reported problematic gambling in 2024, according to the National Council on Problem Gambling (NCPG). Gambling addiction can financially devastate families and is linked to high suicide rates. The NCPG has called on prediction markets to promote its helpline, but Kalshi only links to suicide prevention and treatment providers on a policy page, without using the terms 'gambling' or 'addiction.' Polymarket does not refer users to a helpline. Kalshi recently announced a $2 million investment in the NCPG for education campaigns but will not promote the helpline on its platform.
Advertising and Youth
Recovering addict Rob Minnick found Kalshi ads appearing on his YouTube channel dedicated to gambling recovery, despite blocking gambling-related content. He sent a cease-and-desist letter, and the ads stopped. Minnick said, 'My interpretation is that these businesses are pushing the line until someone says something.' A 2025 study found 85% of Americans believe prediction market sports categories constitute gambling. The platforms target college campuses and young adults, with experts warning they are creating future addicts. A Common Sense Media study found that roughly a third of 11-year-old boys reported gambling in the past year.
Industry Response
Kalshi’s head of communications, Elisabeth Diana, stated, 'With prediction markets, there’s no incentive to make people lose, and we think that’s a fundamental difference.' The company recently announced new rules to curb underage use, including facial recognition technology. Polymarket declined to comment. The CFTC chair recently called prediction markets and sportsbooks 'two separate things,' indicating no immediate reclassification.
For help with gambling addiction in the US, call the National Council on Problem Gambling at 1-800-MY-RESET. In the UK, support is available via the NHS National Problem Gambling Clinic on 020 7381 7722 or GamCare on 0808 8020 133. In Australia, Gambling Help Online is available on 1800 858 858.
