Prediction markets have rapidly grown into a multi-billion-dollar industry, drawing a disproportionate number of young male users. These online platforms allow individuals to place bets on a wide range of events, from sports outcomes to geopolitical developments, offering a new way to engage with news and speculation.
Key developments
Prediction markets like Polymarket and Kalshi have seen a surge in popularity, especially in the United States, where betting on these platforms is legal across all 50 states. Kalshi has been valued at $22 billion, while Polymarket is valued at $9 billion. These platforms operate similarly to commodity futures markets, charging a small fee on bets rather than functioning as traditional gambling sites.
Users are mostly under 45 years old, with 71% being men, according to analytics firm Morning Consult. A poll by the American Institute for Boys and Men (AIBM) and Ipsos found that over a quarter of American men aged 18-24 have used prediction markets or gambling apps recently, compared to 14% of the general public.
Why this matters
The rise of prediction markets among young men raises questions about risk-taking behavior, economic attitudes, and the normalization of gambling-like activities. Experts suggest that prediction markets appeal to young men because they intersect with male-dominated online cultures such as sports betting, cryptocurrency speculation, and competitive online communities.
Jonathan Cohen, head of sports betting policy at the AIBM, points to neurological factors like an underdeveloped pre-frontal cortex and a high appetite for risk in young men. The platforms’ design, resembling financial trading environments, may also contribute to their appeal by making betting feel like strategic investing rather than gambling.
Market impact and concerns
While supporters argue that prediction markets provide better odds and real-time insights into public opinion by allowing users to back their opinions with money, critics warn of significant risks. Many young men lose money, often unaware of the dangers involved. Analysis shows that a small fraction of accounts, often linked to firms with access to advanced tools like AI bots and live data feeds, capture the majority of profits.
There are also concerns about insider trading and ethical issues. Large bets on sensitive events such as the Iran war and the capture of Venezuelan President Nicolas Maduro have raised questions about the fairness of these markets. For example, a US special forces soldier involved in Maduro’s capture allegedly profited significantly from insider information, leading to legal charges.
Both Polymarket and Kalshi have taken steps to police suspicious activity and ban insider trading, but experts note that the legality of some insider bets remains complex. Additionally, some controversial markets related to war and terrorism have been removed by Kalshi, while Polymarket continues to offer geopolitical event markets without charging fees on those bets.
Social impact and cultural factors
Prediction markets are deeply embedded in online male culture. Influencers and social media personalities promote these platforms, often downplaying the risks involved. For instance, YouTuber Logan Paul has had his show sponsored by Polymarket, and memes about “monitoring the situation”—a phrase used to describe following news and market trends—are popular among young men.
Experts like Professor Elvira Bolat from Bournemouth University express concern that prediction markets are framed as intelligence or strategy games rather than forms of gambling, which may mislead users about the risks. The platforms’ resemblance to professional trading tools can give a false sense of security to inexperienced users.
Efforts to attract more women to prediction markets are underway, with Kalshi reporting an increase in female users from 13% to 26% over the past year. Both major platforms use female influencers and culturally relevant memes to broaden their appeal.
What to watch
- Regulatory responses: US lawmakers have introduced legislation targeting insider trading and controversial markets on prediction platforms.
- Platform policies: Continued efforts by Kalshi and Polymarket to police insider trading and promote responsible trading practices.
- User demographics: Monitoring shifts in the gender and age composition of prediction market users.
- Market transparency: Increased scrutiny of how prediction markets operate and their impact on public opinion and financial behavior.
Recommended reading
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