Prediction markets are platforms where people can wager on the outcome of a variety of real-world events — from terrorist attacks, to elections, to natural disasters, to length of a State of the Union address.

Such markets have existed in electronic form since at least the 1980s, with the advent of the Iowa Electronic Markets, the first electronic political prediction market, and have been supercharged in recent times, first with the explosion of the internet, then with a favorable US regulatory regime that did not view prediction markets as gambling.

The annual amount wagered on non-sports predictions on US platforms increased from $20m in 2020 to $50b in 2025. In the past year, two New York City-based prediction markets, Kalshi and Polymarket, each raised money at a valuation near $10b and are expected to raise more at a $20b valuations within the next few months.

Have you interacted with any prediction markets?

Academics have long portrayed prediction markets as a useful source of information; that markets are good for identifying how likely an event is to happen. They cite studies showing groups of people were better at predicting election outcomes when individuals were paid for correct predictions.

The US government has also considered prediction markets worthwhile. In 2001, DARPA launched a platform to let traders bet on geopolitical events — assassinations, coups, and terrorist attacks — on the theory that markets would aggregate intelligence better than analysts. It was discontinued in 2003, when two Senators called it "grotesque” that people could wager on such tragic outcomes.

Since then, agencies in Defense and Intelligence have launched and mostly closed such platforms for ethical reasons (considered wrong to bet on disastrous outcomes) and for fear of causing awful events to happen that wouldn’t otherwise – someone with the power to order or carry out an assassination may bet on an assassination happening.

Do you think prediction markets are likely to do more good by enhancing our ability to see the future, or more harm by causing an increase in awful events?

Last week, analysts identified “six suspected insiders” who made $1.2m betting Ayatollah Khamenei would be out of power shortly before the US attack on Iran. Sen Chris Murphy alleged that people around President Trump were “profiting off war and death” posting, “It’s insane this is legal,” because it allows people in the know to take money from those who aren't.

On Thursday, Sen Amy Klobuchar (D, MN) and Sen Jeff Merkley (D, OR) introduced legislation to restrict federal officials from trading on prediction markets.

Others disagree, arguing prediction insider trading is what we should want as a society – for those in the know to tell us earlier than otherwise what is about to happen, and that the cost for this earlier warning is cheap, borne only by those who take the other side of predictions.

For whom should it be legal to bet on an assassination, or on who will sing the Super Bowl anthem? (check all that apply)