Prediction market traders have wagered nearly $200 million on outcomes of the 2024 midterm elections, according to an NBC News analysis released Friday. The outlet examined 1,408 open markets across Kalshi and Polymarket, two platforms where users bet on sports, global events, and political races.
Prediction markets have emerged as a parallel gauge of political sentiment alongside traditional polling. These platforms allow traders to stake money on specific election outcomes, from individual races to broader partisan control questions. The sheer volume of capital flowing into election-related markets reflects sustained interest in the midterm contests and suggests bettors view these races as competitive enough to warrant significant investment.
Kalshi and Polymarket operate differently than sportsbooks. Rather than accepting bets against a house, they function as peer-to-peer exchanges where users trade contracts tied to actual events. If a contract predicts a candidate wins, the price of that contract fluctuates based on trader confidence. The platforms charge fees on successful trades but do not take positions themselves.
The $197 million wagered represents a substantial increase in prediction market activity compared to previous election cycles. These markets have gained credibility among political analysts and investors who view them as more responsive to new information than traditional polls. Traders can adjust positions instantly based on breaking news, debate performances, or scandal, creating real-time probability assessments.
Regulatory status remains uncertain. Kalshi operates under Commodity Futures Trading Commission oversight, while Polymarket has faced legal challenges over its registration status. Despite regulatory questions, both platforms continue operating and attracting traders.
The prevalence of election betting reflects broader cultural shifts toward alternative data sources for political prediction. While prediction markets cannot replace polling, they offer distinct intelligence. Traders with financial skin in the game face consequences for inaccurate assessments, potentially creating stronger incentives for accuracy than casual poll respondents possess.