Addicts say prediction markets pose the same risk as sports gambling

The soccer coach had blocked himself from sportsbooks by the time he found prediction markets.

The tax accountant said he “got the same high” on those platforms that he got from gambling. “That was how I relapsed — with Kalshi and Polymarket. I lost a bunch of money.”

The rapid growth of prediction markets has ignited an intense debate playing out in courtrooms and legislative chambers nationwide. While operators argue they should be regulated like stock exchanges due to federal law and their customer-to-customer structure, sportsbooks and state officials contend they require the same oversight as sports gambling platforms.

As this regulatory battle continues without resolution, addiction specialists are raising alarms about what they’re witnessing in treatment centers. From their perspective, the distinctions between sports gambling and prediction markets become largely irrelevant when observing patient behaviors.

“There may be real differences in how these products are defined or regulated, but in the therapy room, we are often seeing the same cycle of anticipation, action and reaction play out again and again,” explained Dr. Cynthia Grant, vice president of clinical for Birches Health, which operates a national network for treating gambling addiction.

“I sometimes think of it like different doors into the same room. The label on the door may change, but once someone’s inside, the experience can feel very familiar.”

While sportsbooks and prediction markets offer similar betting opportunities, their formats differ. Sportsbooks employ in-house experts who set odds determining payouts, essentially pitting the house against gamblers. Prediction markets, however, allow traders to exchange contracts on yes-or-no questions, with profits determined by market forces. These platforms typically generate revenue through contract fees rather than betting losses.

For addicts seeking recovery, this distinction provides little comfort. The 21-year-old soccer coach who spoke with the Associated Press began gambling at 16, making small bets with friends in his New York neighborhood. Upon turning 18, he graduated to casinos and sportsbooks before discovering prediction markets amid mounting losses.

“I would be in all this debt and get a paycheck for $2,000 on a Friday and it would be gone by Saturday or Sunday,” he recalled. “I wouldn’t have money to fill up my gas tank.”

Juggling student loans, maxed-out credit cards, college studies, and employment, he eventually stepped away in January to address his addiction issues. Though he joined Gamblers Anonymous, he found their recommendation to cut ties with gambling associates particularly challenging. “For a younger crowd, that’s difficult because it’s everywhere,” he said. “My friends from childhood — most of them all gamble.”

Both the coach and the tax accountant had formally self-excluded from sportsbooks before migrating to prediction markets. Self-exclusion programs allow gamblers to ban themselves from gambling facilities and betting apps, but implementation varies significantly by state, with no comprehensive national system in place.

The fragmentation becomes even more pronounced with prediction markets. While Kalshi launched a voluntary opt-out program in March 2025, and several platforms including Polymarket are collaborating on a national self-exclusion program, it remains unclear whether these initiatives will ever integrate with state gambling regulatory systems.

The 33-year-old accountant’s gambling problems began when New York legalized mobile sports betting in January 2022. By August 2023, he had accumulated “a boatload of debt” before confessing to his then-fiancée. After their wedding, they moved into a rental property owned by his parents to save money, and he self-excluded from sportsbooks.

Following the couple’s miscarriage, the accountant turned to day-trading before discovering Kalshi. “Prediction markets are the same thing packaged in a different way,” he said. “It’s a dangerous loophole… How can you do all that and say you’re not a sportsbook?”

He later experienced a relapse in December after downloading Polymarket and making a free $10 wager, which his wife discovered through their linked email accounts.

Treatment experts confirm that these experiences are not unusual. “You’re seeing a lot of the same behaviors, whether it’s a prediction market or it’s gambling,” noted Jody Bechtold, CEO of The Better Institute, a Pennsylvania practice specializing in gambling disorders. “You’re seeing wagering more and more, chasing losses… The lies, the secrecy, and that it’s impacting everyday life.”

Kalshi spokesperson Elisabeth Diana emphasized the platform’s responsible trading programs and ongoing efforts to facilitate healthy trading behavior, arguing that compared to casinos, Kalshi is “fairer, more transparent, and less predatory” because “there is no house that wins when customers lose.”

Sports have emerged as a major category for prediction markets. According to Diana, Kalshi recorded more than $2 billion in total trading volume during this year’s NCAA men’s basketball tournament. The championship game between Michigan and Connecticut generated $10.6 million in volume on Polymarket alone.

A Bank of America report projects the U.S. market for sports-focused event contracts could grow to approximately $1.1 trillion in annual volume.

Dr. Timothy Fong, co-director of the UCLA Gambling Studies Program, noted the rapid emergence of prediction markets in clinical settings. “A year ago, if you said prediction markets, I mean I don’t know what that is, I don’t see it,” he said. “Now we’re starting to see it more and more in our patients… When you have something that’s available, accessible, anonymous, super easy to use, multiple times in a day, of course that’s going to raise the risk of addiction.”

Multiple ongoing lawsuits between states and prediction markets have created significant regulatory uncertainty. Marlene Warner, CEO of the Massachusetts Council on Gaming and Health, described the current situation as “the wild, wild west,” noting the absence of clear regulatory frameworks that typically accompany legalized gambling activities.

Unlike sports gambling, which is generally restricted to those 21 and older in states where it’s legal, prediction markets are typically available to 18- to 20-year-olds, with some exceptions. These markets also operate in states like Texas and California, where sports betting remains illegal.

Prediction markets fall under the jurisdiction of the federal Commodity Futures Trading Commission (CFTC), whose chairman Michael Selig has asserted the commission’s “exclusive jurisdiction over these markets” in legal proceedings against several states.

As this regulatory battle continues, the soccer coach and tax accountant focus on rebuilding their lives while managing their addictions. “You have to face this stuff or it just keeps getting worse,” the coach concluded.