Prediction Markets by the Numbers: What Financial Advisors Need to Know

By Don Friedman | CEO, The Truth About Your Future
October 1, 2026

Prediction markets let people buy “yes” or “no” contracts on real-world outcomes, from elections to sporting events. Monthly trading volume on the two leaders, Kalshi and Polymarket, went from under $5 billion in mid-2025 to a record $50.6 billion in July 2026, boosted by the World Cup. The following is what the data shows about who uses them, and what it means for advisors and their clients.

Who uses prediction markets

A February 2026 Paradigm poll found that 38% of 18- to 34-year-olds and 28% of 35- to 49-year-olds had put money into prediction markets, compared with just 3% of those 65 and older*. A narrower SSRS survey found that 5% of American adults, roughly 13 million people, use prediction markets to trade on sports, rising to 11% among men 18 to 34.

One survey put the median age of participants at 33, with 36.6% holding a bachelor’s degree or higher, and 59% of respondents were male.

Why people trade

Many users are chasing income, not entertainment. In a BadCredit.org survey, 44% wanted extra income and 9% reported financial hardship, while only 27% participated purely for fun or curiosity. The survey also found 51% of users had funded bets with a credit card, personal loan, or other borrowed money.

Do people make or lose money?

Most lose. On Polymarket, 0.1% of accounts captured 67% of all profits, according to a Wall Street Journal analysis. On Kalshi, losing users outnumbered winners 2.9 to 1 over one recent month, according to a company spokeswoman. The company argues that losses are common across speculative markets, citing its own data showing roughly 74% of its traders post losses, versus 81% in equities and 96% at sportsbooks, though it did not detail its methodology. For clients, the takeaway is that short-term speculation, on any platform, tends to favor professionals over retail participants.

How much do people win or lose?

The WSJ, reviewing 1.6 million Polymarket accounts active since November 2022, found that more than 1.1 million accounts lost money. The typical user is down between $1 and $100 in total, while the worst-performing 10%, roughly 160,000 accounts, have lost an average of $4,000 each. At the other end, fewer than 2,000 accounts have netted an average of at least $250,000 each. In the BadCredit.org survey, 27% of users lost more than $500 in the past year.

What people bet on, and who prediction markets compete with

Mostly sports. In the 30 days ending January 20, 2026, sports made up 91% of Kalshi’s volume. Polymarket’s mix is broader, with more politics, crypto, and world events.

That makes sportsbooks the main competitor. FanDuel and DraftKings, which together hold more than 65% of U.S. sports betting, have launched their own prediction markets, alongside Robinhood, Crypto.com, and others.

How much are prediction markets spending to attract users?

A lot. Through August 2026, Kalshi spent $41.3 million on national TV ads and Polymarket $7.4 million, helping push betting-category TV ad spending up 40% from a year earlier. That puts Kalshi third among all betting advertisers on national TV, behind only DraftKings and FanDuel.

What it takes to open an account

Very little. Users must be 18 or older with a U.S. address and pass identity verification. According to Kalshi’s help center, the minimum deposit is just $10 for standard payment methods.

Is there a bankruptcy comparison?

No data yet tracks bankruptcies among prediction market users. But because sports make up most prediction market volume, research on online sports betting offers a reasonable proxy. A study by researchers at UCLA, Harvard, and USC found that when states added online sports betting, the likelihood of bankruptcy rose about 25% and debt sent to collections rose 9%, equal to roughly 30,000 additional bankruptcies a year nationwide. Credit card delinquencies rose about 27%, mostly among borrowers who were already financially stretched.**

Is there an opioid comparison?

Former U.S. Surgeon General Jerome Adams has compared the growth of sports betting to the early opioid epidemic. The data doesn’t support treating the two as equivalent. Opioids are measured in deaths, an estimated 44,564 in 2025. Gambling harm shows up mostly as financial loss and addiction, and the mental health evidence is mixed. The comparison that holds up is about how the growth happened: rapid commercial expansion ahead of regulation.

What it means for advisors and their clients

Client behavior. Younger clients are the most exposed. Northwestern Mutual found that 32% of Gen Z and 24% of millennials are using or considering prediction markets or sports betting. The effects can spill over into portfolios. Wealth management consultants report that firms are seeing unexpected losses and unusually high risk-taking, often from trading accounts outside the advisor’s view.

Discovery conversations. Consider asking about prediction markets alongside questions about options, margin, and concentrated positions, in a non-judgmental tone, because clients who feel judged will hide the behavior. Remind clients that investing means owning something that grows over time. A prediction market bet is over in hours or days. Rather than betting on what the Fed will do, build portfolios that hold up regardless of what the Fed does.

Advisor compliance. Firms are restricting their own people. Goldman Sachs now bars employees from event contracts on specific companies, elections, financial markets, macroeconomic data, and geopolitics, though sports and entertainment contracts remain allowed. The key risk is information: an advisor who trades on material non-public information from a client could violate CFTC insider trading rules.

The bottom line

Prediction markets are growing fast, skew young and male, and are mostly used for sports. The data consistently shows that most retail participants lose money while a small group of sophisticated traders captures most of the profits. For advisors, the practical takeaways are to ask clients about it directly, treat it as entertainment spending rather than income, and know your own firm’s rules before trading.

* Paradigm is an investor in and supporter of prediction markets, including Kalshi.
** The study covers sportsbooks, not prediction markets, and the 25% reflects a relative increase in risk, not the share of bettors who went bankrupt.

Credit: AI generated by Magnific

Sources

1. Pew Research Center – prediction market trading volume (May 2026): https://www.pewresearch.org/short-reads/2026/05/27/trading-volume-on-prediction-markets-has-soared-in-recent-months/
2. Covers – Kalshi, Polymarket trading volume hits $50B high in July 2026: https://www.covers.com/industry/kalshi-polymarket-trading-volume-hits-50-billion-high-in-july-2026
3. Paradigm – February 2026 poll on prediction markets: https://www.paradigm.xyz/writing/paradigm-february-2026-poll-on-prediction-markets
4. Straight to the Point – Paradigm investment disclosure: https://straighttothepoint.substack.com/p/we-asked-100-people
5. SSRS – Americans using prediction markets for sports: https://ssrs.com/insights/how-many-americans-use-prediction-markets-for-sports/
6. org – Prediction Market Industry Snapshot 2026: https://www.casino.org/us/predictions/prediction-market-trends-april-2026/
7. org – prediction market user survey: https://www.badcredit.org/studies/prediction-markets/
8. Parameter – BadCredit.org survey detail: https://parameter.io/new-survey-reveals-79-of-prediction-market-traders-suffered-losses-in-past-year/
9. BeInCrypto – WSJ analysis of Polymarket/Kalshi losses and Kalshi’s response: https://beincrypto.com/prediction-market-polymarket-kalshi-users-losing-money-wsj/
10. PANews – WSJ loss distribution: https://www.panewslab.com/en/articles/019e0071-5493-706a-93d0-2cbe1b436cdb
11. The Closing Line – Kalshi non-sports volume: https://closingline.substack.com/p/the-takeaway-kalshi-non-sports-volume
12. Front Office Sports – FanDuel/DraftKings enter prediction markets: https://frontofficesports.com/article/fanduel-joins-prediction-market-fray-as-new-app-goes-live/
13. The Measure – Prediction Markets Pace Sports Betting TV Ad Growth (iSpot data): https://www.themeasure.net/prediction-markets-pace-sports-betting-tv-ad-growth-novig-sweeney-ispot/
14. The Measure – Like It Or Not, Kalshi Has Become Major Part Of Sports Betting Market: https://www.themeasure.net/like-it-or-not-kalshi-has-become-major-part-of-sports-betting-market/
15. CBS Sports – Kalshi account requirements: https://www.cbssports.com/betting/news/kalshi-promo-code
16. Kalshi Help Center – Transfers FAQ: https://help.kalshi.com/en/articles/13823791-transfers-faq
17. Hollenbeck, Larsen & Proserpio, “The Financial Consequences of Legalized Sports Gambling,” Management Science (2026): https://doi.org/10.1287/mnsc.2025.02515
18. Northeast Times – Jerome Adams opioid comparison: https://northeasttimes.com/2026/08/26/former-surgeon-general-compares-sports-betting-to-opioid-crisis/
19. CDC/NCHS – 2025 provisional overdose deaths: https://cdc.gov/nchs/pressroom/releases/20260513.html
20. org – mixed research on betting and suicide: https://www.casino.org/news/is-sports-betting-the-next-opioid-crisis-us-surgeon-general/
21. CNBC – Northwestern Mutual Gen Z/millennial data: https://www.cnbc.com/2026/05/05/gen-z-millennials-prediction-markets.html
22. Advisor Perspectives – Wealth Management Firms & the Rise of Prediction Markets: https://www.advisorperspectives.com/articles/2026/02/03/wealth-management-firms-rise-prediction-markets
23. The Oasis Group – discovery questions for advisors: https://theoasisgrp.com/vantage-point/how-wealth-management-firms-should-engage-with-the-rise-of-prediction-markets/
24. Advisor Perspectives – How to Talk to Clients About Prediction Markets: https://www.advisorperspectives.com/articles/2026/03/10/how-talk-clients-prediction-markets
25. InvestmentNews – Goldman leads wave of prediction market bans: https://www.investmentnews.com/regulation-legal-compliance/goldman-leads-wave-of-prediction-market-bans-at-financial-firms/267395

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