Are prediction markets gambling? Regulators increasingly say yes
There’s always another market about to resolve, so there’s always a reason to refresh. You
told yourself this was “forecasting” — that you were just good at reading the news. Then you
noticed how your stomach drops when the number moves against you, and how much you’ve staked
on being right.
If you’re refreshing event markets the way you used to refresh a sportsbook, that’s not a
coincidence. It’s the same machine with a cleaner logo — and it’s not a discipline problem.
It’s a book, not a forecast
Regulators are calling it what it looks like. Attorneys general in Massachusetts,
Washington, and Arizona have gone to court alleging prediction-market operators run
unlicensed sports wagering and illegal gambling;1,2 on one leading platform more
than 90% of activity is sports betting, and in 2026 the U.S. Senate barred its own
members from betting on these markets.2 The payout math is a book’s, too — by
one major platform’s own reported figures, there are roughly 2.9 unprofitable users for
every profitable one.2 The house doesn’t need you wrong every time. It needs
you to keep coming back, and every headline is a fresh reason to.
What you can do tonight
Kill the notifications. No “your market is moving,” no resolution alerts.
Make it a hassle to reach. Log out; if it runs in your browser, clear the saved login
so getting back in takes real effort.
Tell one person before you put money on the next outcome.
The one that actually holds: a witness
A wall you control won’t survive the next headline. So Electric Nipple Clamps adds a person
instead. You pick the apps you want to stay honest about, name one person you trust, and each
time you open one they see the count — every week, never your positions or the markets you
traded. You can delete an app in a weak moment. You can’t un-tell someone who already knows.
Regulators increasingly say yes. Attorneys general in Massachusetts, Washington, and Arizona have sued or filed criminal charges against prediction-market operators, alleging they run unlicensed sports wagering and illegal gambling. On one leading platform, more than 90% of activity is sports betting, and the U.S. Senate barred its own members from betting on prediction markets in 2026.
Do people lose money on prediction markets?
By the platforms' own numbers, most do. One major prediction market has reported roughly 2.9 unprofitable users for every profitable one — the same losing math as any other book.
Why are prediction markets so hard to put down?
Every headline becomes a market and every market settles, so there's always a new contract and a reason to refresh. Many run through a browser as well as an app, which is exactly the kind of always-available loop that's hard to walk away from.
How do I stay accountable about prediction markets?
Add a person, not another wall. With Electric Nipple Clamps you put the apps you want to stay honest about on a watch list and name one person who sees, every week, how often you opened them — never your positions or the markets you traded.
Sources
AG Campbell Sues Online Prediction Market for Illegal and Unsafe Sports Wagering Operations. Office of the Massachusetts Attorney General, 2025.
mass.gov
Kalshi. Wikipedia (summarizing public regulatory actions, court filings, and the platform's reported figures).
en.wikipedia.org