\n
<\/p>\n
The soccer coach had blocked himself from sportsbooks by the time he found prediction markets.<\/p>\n
The tax accountant said he \u201cgot the same high\u201d on those platforms that he got from gambling. \u201cThat was how I relapsed \u2014 with Kalshi and Polymarket. I lost a bunch of money.\u201d<\/p>\n
The rapid growth of prediction markets has sparked a high-stakes debate that is playing out in courts and legislatures all over the country. Operators of those companies believe they should be regulated like the stock exchange because of federal law and their customer-to-customer structure, while sportsbooks and state officials think they should be supervised the same way as sports gambling platforms.<\/p>\n
While that argument continues with no sign of resolution, the clinicians who treat gambling disorders are more concerned about what they are seeing with their patients. In their spaces, when it comes to sports gambling and prediction markets, the end result is virtually the same.<\/p>\n
Two gambling addicts who spoke to The Associated Press \u2014 the soccer coach and tax accountant \u2014 say they had relapses on prediction markets after they took legal action to protect themselves from the allure of sports betting. They are being identified by their occupations because of the sensitivity of their situations. <\/p>\n
Their stories reflect what experts say they see with some of their clients.
\u201cThere 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,\u201d said Dr. Cynthia Grant, the vice president of clinical for Birches Health, which operates a national network of providers for treating gambling addiction.<\/p>\n
\u201cI sometimes think of it like different doors into the same room. The label on the door may change, but once someone\u2019s inside, the experience can feel very familiar.\u201d<\/p>\n<\/div>\n
Sportsbooks and prediction markets offer a lot of similar options. Wagers on games, individual performances and other possibilities. But the format is different.<\/p>\n
Sportsbooks have in-house experts who set odds that dictate payouts for winning bets. It\u2019s the house versus the gamblers. Traders on predictions markets swap contracts of yes-or-no questions, and profits and losses are dictated by the market. Win a \u201cyes\u201d holding on an event contract where most of the market guessed \u201cno,\u201d and the payout is bigger. Prediction markets generally make money through fees on contracts.<\/p>\n
For addicts, they are two paths to the same result.<\/p>\n
The soccer coach who spoke to the AP started gambling when he was 16. Small bets against friends in his New York neighborhood, everything from cards to basketball and tennis. When he turned 18, he started going to casinos and making bets at sportsbooks. Amid mounting losses, he turned to prediction markets.<\/p>\n
\u201cI 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,\u201d said the coach, 21. \u201cI wouldn\u2019t have money to fill up my gas tank.\u201d<\/p>\n
He was struggling with loans and maxed-out credit cards while working and going to college before he stepped away in January to confront his addiction problems, which also included smoking marijuana.<\/p>\n
He joined Gamblers Anonymous, and he was told he had to stop associating with people who gamble.<\/p>\n
\u201cFor a younger crowd, that\u2019s difficult because it\u2019s everywhere,\u201d the coach said. \u201cMy friends from childhood \u2014 most of them all gamble.\u201d<\/p>\n
The coach and the tax accountant had formally self-excluded from sportsbooks before they started trading on prediction markets. Self-exclusion programs provide an opportunity for gamblers to ban themselves from gambling facilities and betting apps. They are offered in many states as part of gambling regulations, but there is no widely adopted national system.<\/p>\n
The landscape for self-exclusion programs becomes even more fragmented when predictions markets are included. Kalshi started a voluntary opt-out program when it launched a customer protection hub in March 2025, and it\u2019s one of several platforms \u2014 including Polymarket \u2014 collaborating on a national self-exclusion program for prediction markets. But it\u2019s not clear if that program would ever overlap with the systems used by state gambling regulators.<\/p>\n
The accountant, 33, said his gambling problems started after New York launched legalized mobile sports betting in January 2022. He had \u201ca boatload of debt\u201d in August 2023 when he told his then-fianc\u00e9e about what was going on with him.<\/p>\n
She married him anyway. Looking to save money after the wedding, they moved into a rental house owned by his parents. He self-excluded from sportsbooks. Then, after the couple lost their first pregnancy, the accountant started day-trading before signing up for Kalshi.<\/p>\n
\u201cPrediction markets are the same thing packaged in a different way,\u201d the accountant said. \u201cIt\u2019s a dangerous loophole. \u2026 How can you do all that and say you\u2019re not a sportsbook?\u201d<\/p>\n
Tennis was his go-to sport \u2014 he liked the speed of the matches \u2014 before he went to rehab in Virginia last year.<\/p>\n
He had a relapse in December when he downloaded Polymarket and made a free $10 wager. He was confronted by his wife, who had his email connected to her phone and reached out to his sponsor.<\/p>\n
While there has been no substantive research into the effect of prediction markets on sports gambling addiction, the experiences of the coach and the accountant are not uncommon for treatment experts.<\/p>\n
\u201cYou\u2019re seeing a lot of the same behaviors, whether it\u2019s a prediction market or it\u2019s gambling,\u201d said Jody Bechtold, the CEO of The Better Institute, a Pennsylvania practice that works with people impacted by gambling disorders. \u201cYou\u2019re seeing, you know, wagering more and more. Chasing losses, so \u2018Oh, today was a bad day, I have to work tomorrow at the prediction markets to get my money back.\u2019 \u2026 The lies, the secrecy, and that it\u2019s impacting everyday life.\u201d<\/p>\n
Kalshi spokeswoman Elisabeth Diana highlighted its programs for responsible trading \u2014 such as trading breaks and self-limits \u2014 and said it\u2019s working on other measures to further facilitate healthy trading behavior.<\/p>\n
Compared to casinos, Diana said, Kalshi is \u201cfairer, more transparent, and less predatory.\u201d<\/p>\n
\u201cThere is no house that wins when customers lose,\u201d she said. \u201cThis means that Kalshi doesn\u2019t hook losers and penalize winners.\u201d<\/p>\n
A message was left seeking comment from Polymarket.<\/p>\n
Sports have become a major category for prediction markets. Kalshi had more than $2 billion in total trading volume on this year\u2019s NCAA men\u2019s basketball tournament, according to Diana. Michigan\u2019s 69-63 victory over Connecticut in the championship had $10.6 million in volume on Polymarket.<\/p>\n
The U.S. market for sports-focused event contracts could grow to approximately $1.1 trillion in annual volume, according to a Bank of America report.<\/p>\n
\u201cA year ago, if you said prediction markets, I mean I don\u2019t know what that is, I don\u2019t see it,\u201d said Dr. Timothy Fong, the co-director of the UCLA Gambling Studies Program. \u201cNow we\u2019re starting to see it more and more in our patients that come into the clinic. And it\u2019s usually not one, it\u2019s multiple platforms they\u2019re betting on, right? \u2026 When you have something that\u2019s available, that\u2019s accessible, that\u2019s anonymous, is super easy to use, multiple times in a day, of course that\u2019s going to raise the risk of addiction for any human on Earth.\u201d<\/p>\n
There are multiple ongoing lawsuits involving states and prediction markets, and the ramifications of the legal dispute are being felt on a variety of levels.<\/p>\n
Marlene Warner, the CEO of the Massachusetts Council on Gaming and Health \u2014 a private nonprofit health organization that provides educational programs on gambling along with other services \u2014 said the situation with prediction markets \u201cfeels a bit like the wild, wild west right now.\u201d<\/p>\n
\u201cWe\u2019re very used to like going to our state regulator or, you know, seeing a process go through where all of a sudden now you\u2019re like, \u2018OK, a piece of legislation has outlined what is appropriate for a licensed sports betting operator to do,’\u201d Warner said. \u201cAnd then you see the regulation come into place. And so you can track it. But right now, nobody knows kind of what the limits are.\u201d<\/p>\n
In most states with legal sports gambling, it is limited to ages 21 and older, while prediction markets are open for 18- to 20-year-olds with some exceptions. Prediction markets also have a presence in states where sports betting is illegal, including Texas and California.<\/p>\n
\u201cI don\u2019t know enough frankly, we don\u2019t know enough, nothing\u2019s been studied about them, I can\u2019t tell you whether they\u2019re more less or exactly the same in terms of risk level,\u201d Warner said. \u201cBut what I do know is they\u2019re in a very gray, unregulated space and that alone makes it difficult.\u201d<\/p>\n
Prediction markets fall under the jurisdiction of the federal Commodity Futures Trading Commission, which has a regulation that prohibits an event contract \u201cthat involves, relates to, or references terrorism, assassination, war, gaming, or an activity that is unlawful under any state or federal law.\u201d<\/p>\n
CFTC chairman Michael Selig is backing prediction markets in their legal proceedings against several states, asserting the commission\u2019s \u201cexclusive jurisdiction over these markets.\u201d<\/p>\n
While that argument continues, the soccer coach and tax accountant are rebuilding their lives \u2014 while doing their best to stay vigilant with their addictions.<\/p>\n
\u201cYou have to face this stuff or it just keeps getting worse,\u201d the coach said.<\/p>\n
AP sports: https:\/\/apnews.com\/sports<\/p>\n<\/div>\n