Individuals under the age of 18 may be driving far more handle to prediction markets, a new analysis by CNN suggests. Prediction markets have argued that U-18s demographics constitute just a small fraction of what they generate in terms of turnover, but even then, the financial aspects of this “limited” trading activity are still massive.
CNN Looks Closer at Trading Volume for Under 18s on Kalshi – Billions Going Down
According to CNN, U-18s’ trades drive about $5.4 billion in trades on Kalshi alone, with $3.9 billion of that amount on sports event contracts. This is important because in most places around the United States, sports betting is regulated and the minimum participation age is 21.
In other words, Kalshi is capitalizing on a young cohort of people interested in placing money on the outcomes of sports.
Whether those constitute “trades” or “ bets” depends on the vantage point, with Kalshi clearly arguing that its products are not the same as gambling. If anything, they are superior, as noted by company CEO Tarek Mansour.
At the same time, Kalshi is now expanding its offer, offering players a trading option not unlike “parlay bets,” or “combos,” where traders may combine several outcomes in the same wager.
If all outcomes come true, a trader is rewarded a greater sum than they would have got on single event betting. Les Bernal, the national director of Stop Predatory Gambling, commented for Fortune, one of the publications to study the CNN analysis and report on it, that there was a real issue with the way prediction markets operated right now.
“They try to create this experience; it’s like a video game type experience, in pushing this on young people. Meanwhile, we know from the science that this is an extremely addictive product that causes incredible harm,” Bernal noted.
Keeping Markets Open to U-18s Could Be Contributing to Addiction
Prediction markets are a fairly new vertical, and their mass popularity has only just begun, meaning that there is a lot that is still unknown about the actual impact these platforms and event contracts tied to entertainment, politics and sports have on young people.
According to a paper published in Science last April, however, “the continuous novelty and infinite event streams eliminate stopping points.”
Not everyone follows the same example as Kalshi, however. Fanatics, a sports betting and merchandise company, has recently introduced its own prediction market platform, but it specifically chose to not allow anyone under the age of 21 to trade on sports events.