(Photo by Justin Mathews via AnimationXpress/CC BY-SA 3.0 DEED)
Immediately after the U.S. kidnapped Venezuelan President Nicolas Maduro on January 3, 2026, an anonymous gambler on the “prediction” website Polymarket earned $400,000 USD after placing a series of bets on the days leading up to the event. This is not the first time someone has profited from “predicting” political events, but it is one of the most shocking.
Currently, Polymarket allows you to “predict” who will win the 2026 World Cup, the price of bitcoin, whether the U.S. will own Greenland by 2026 or 2027, if Jesus will come back before 2027, and whether the U.S. will strike Iran by the end of March, amongst many other possible occurrences.
Although it may seem that the growth of prediction markets and online betting occurred suddenly, they have been on the rise since 2018. That year, the U.S. Supreme Court struck down the 1992 Professional and Amateur Sports Protection Act (PASPA), which had outlawed most sports betting in most states, effectively legalizing it.
When the U.S. Congress passed PASPA in 1992, people could only place sports bets either in Vegas or with a bookmaker affiliated with organized crime. In the 26 years since 1992, the internet allowed foreign bookmakers to create a network of illegal gambling sites where Americans could place wagers on all manner of sports. The Supreme Court’s 2018 decision effectively onshored that whole industry and allowed it to grow exponentially.
The House Always Wins
Americans have wagered more than $500 billion USD on sports since 2018. Betting companies essentially function as online casinos. They both operate with a house edge, meaning that over time, the company always wins at the expense of the gambler.
While a sports bookmaker, informally referred to as a bookie, has less control over the outcome of a soccer game than a casino does over a game of craps, they can still shape the betting conditions. The bookie can set the odds of an event happening in their favour, giving themselves the highest chance of profiting from a bet. In more nefarious cases, bookies may even rig sporting events to secure a profit.
Bookies Refine Game Mechanics
In recent years, betting companies have adopted machine learning and AI to develop increasingly complex algorithms, ensuring sustained profitability. Other times, when there is a very attractive wager, bookies will discreetly control betting behaviours, such as by capping the maximum allowable bet, minimizing their potential payout.
Bookies may also alter the odds of a certain bet if they notice a high volume of wagers on that outcome. They will also make the less attractive bet more attractive to coax gamblers to wager on the less likely outcome. Furthermore, bookies have introduced the live bet cashout option, which allows gamblers to immediately cash out—either at a profit or a loss—before an event is even over.
This option allows bookies to minimize losses when a bettor is making money, to profit from a losing bet, and to give the gambler the feeling of not having lost because they are still left with some of their original wager. In the event a gambler consistently wins, the company can simply ban them from ever playing again.
All of these techniques amount to risk mitigation for the bookies, allowing them to ensure they continue to profit from gamblers while providing no real value. The gamblers front the capital, the athletes provide the labour, and the bookies reap the reward.
Sanitizing the Betting Industry
If all gamblers understood the betting industry’s mode of production, it would not be as profitable as it is today. Aware of that fact, betting companies have sanitized their image. They do this through a mix of clever advertising campaigns featuring influencer partnerships, celebrity cameos, and publicizing their riskiest bets while offering “free bets.”
Betting companies have partnered with all sorts of celebrities, ranging from actors like John Hamm and Kevin Hart; athletes like Wayne Gretzky, Sergio Aguero, and Lebron James; musicians like Drake; and streamers such as Adin Ross. With such a wide net of celebrity endorsements, betting companies reach large segments of the predominantly male population to capture the largest possible customer base.
After capturing a potential gambler’s attention through their favourite celebrity, betting companies attempt to retain their interest through advertisements that promote high-risk, high-reward bets, such as parlays and “free bets.” Companies focus on these ads because they attract potential gamblers by promising high earnings or by presenting a risk-free bet in which no money can be lost.
Parlaying its Way into the Mainstream
However, parlays, a single sports wager that combines two or more individual bets into one, requiring every selection to win for the entire wager to result in a payout, rarely come true because of the combined nature of the bet, increasing the likelihood of losing. Gamblers often favour parlays because they perceive the potential earnings to be much higher than those from a single bet. Bookies, on the other hand, favour parlays because they are 20% more profitable than a regular bet. That is why betting companies heavily promote parlays in advertising.
While “free bets” encourage risky behaviour, the term is a total misnomer, as there is no such thing as a free bet. Often, betting companies will advertise “$200 in free bets,” making it seem as if the customer is receiving $200 cash with which to gamble. That is not the case. The “free bet” is issued as “in-app currency.” It is not possible to withdraw the “free bet” in cash.
And even if the gambler wagers the $200 “free bet” at even odds, meaning they win the same amount as the original bet, they would only walk away with $200, not $400, as expected, because that “free” $200 never existed in the first place. A profit-centred corporation would never risk giving away “free money.” Some betting companies will also promote “risk-free” bets worth thousands of dollars to get prospective customers used to betting large sums of money, ensuring they maintain a steady stream of high rollers they can profit from.
Betting companies, through their production methods and aggressive advertising campaigns, achieved tremendous success and growth. The 2024 revenue for the U.S. sports gambling market was $13.7 billion, while the revenue for the U.S. and Canadian film industry in 2025 was a measly $8.66 billion.
Wall Street’s Next Frontier
Sensing sports gambling’s explosive growth and profitability, Wall Street executives have turned their attention to prediction markets. Interestingly, prediction markets are a relatively old phenomenon, first appearing in the 16th century, and peaking in the early 20th century, when the New York Times published election odds for its readers.
Equally interesting is that prediction markets have returned to prominence through betting on elections. In the 2024 U.S. presidential election, gamblers wagered over $3 billion on the prediction market platform Polymarket alone.
How “Predictions” Still Count As Gambling
Prediction markets used to exist in a legal gray zone. The Commodity Futures Trading Commission (CFTC), the U.S. government agency that regulates certain financial markets, initially considered prediction markets to fall under its jurisdiction because it believed they were structured as “event contracts.” The person who plays a bet gets paid out depending on whether something happens, which counts as an event contract. And because the CFTC considered prediction markets as a form of gambling, it restricted their expansion.
However, this ended after Kalshi, another prediction market platform, sued the CFTC, arguing that “elections aren’t games of chance—they’re processes of governance,” claiming that elections should not be treated as gambling. Somehow, the Washington D.C. district court agreed and ruled in Kalshi’s favour.
But the court’s ruling was ridiculous because placing a “prediction” on a prediction market meets the textbook definition of gambling. Encyclopedia Britannica defines gambling as “the betting or staking of something of value, with consciousness of risk and hope of gain, on the outcome of a game, a contest, or an uncertain event whose result may be determined by chance or accident or have an unexpected result by reason of the bettor’s miscalculation.” Elections are fundamentally uncertain events and contests between two or more candidates or parties.
Gamble on Everything!
Prediction markets function like betting companies: they collect capital from gamblers, allow the event wagered on to act as the labour, and then reap the profits. The court’s ruling also permitted platforms such as Kalshi and Polymarket to expand into every aspect of life. Klashi’s CEO, Tarek Mansour, even articulated that that was his goal, “the long-term vision is to financialize everything and create a tradeable asset out of any difference in opinion.”
Mansour has already partially enacted his vision by partnering with CNN, allowing people to “predict” the news, while Kalshi partnered with CNBC last December. Kalshi has also mirrored the betting companies’ strategy by partnering with well-known figures and institutions such as professional golfer Bryson DeChambeau and the NHL’s Chicago Blackhawks. Ultimately, prediction markets and betting companies not only share the same mode of production and advertising strategies but also the same end goal: profit.
Higher Stakes, Bigger Risks
While both can encourage wrongdoing, the sheer number of possible bets in prediction markets creates greater problems. The worst possible transgressions in sports betting are when an athlete, team, or referee rigs a game to achieve a desired outcome.
With prediction markets, potential misconduct ranges from match-fixing, election manipulation, insider trading, and profit-seeking around conflicts or crises. Remember that an anonymous gambler on Polymarket made $400,000 USD because he bet the U.S. would illegally kidnap Maduro. Prediction markets enable government officials to profit from policy decisions they will enact, turning public policy into a potential payout. It’s essentially insider trading, at a much larger scale.
The Human Cost of Casino Capitalism
The explosion of betting and prediction markets also highlights a deeper, disturbing truth of our modern economy. The number of people—especially young men—who are gambling shows that they no longer believe a traditional job will give them the means necessary to live comfortably; they instead chase a quick profit off a good “prediction”, a hot hand or a lucky sports wager. Gambling at this scale highlights the economic desperation within society, and gambling companies are using their mode of production to profit from it.
Not only have gambling companies and prediction markets profited from this economic desperation, but they have also created an addiction crisis. According to a Fairleigh Dickinson University survey, 45% of men under 30 exhibit at least one trait associated with problem gambling.
This growing phenomenon does not end with increased social isolation and other problem behaviours in young men. It’s also leading to dissociation with reality. World events are no longer consequential moments that elicit reflection or empathy for others. World events are now a game you can profit from, if you’re lucky enough.
Edited by Gustavo Villela
