(NewsNation) — Imagine a stock market for future events, except instead of trading Fortune 500 stocks, you’re betting on a movie’s Rotten Tomatoes score.
That’s the idea behind prediction market platforms like Kalshi, where users can wager on everything from the next U.S. president to who will be named in the Epstein files.
Earlier this month, one user made around $23,000 by correctly predicting that the CEO of Astronomer would leave the company after a viral kiss-cam clip at a Coldplay concert. Another walked away with more than $50,000 for correctly predicting the pope.
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Wins like those have helped U.S.-based Kalshi grow to roughly two million users, ten times what it had just a year ago.
Much of that surge can be attributed to the 2024 election, as more people turned to prediction markets, not polls, for a clearer read on the future. Kalshi traders priced in a Trump victory well before election day, and many saw skin in the game as the ultimate signal.
“The fact that people have money on the line means they’re very, very incentivized to drill down to the truth,” said Jack Such, head of media at Kalshi.
What is a prediction market?
Prediction markets allow people to bet on future events, such as elections or weather, through online platforms. Unlike traditional sports betting, where odds are set by bookmakers, prediction markets rely on the wisdom of crowds.
“You have traders on both sides, buying and selling, and that activity is what creates the price,” Such said.
In that sense, prediction markets operate more like a stock market, Such pointed out. But instead of shares in a company, users are trading contracts tied to real-world events.
That’s one of the reasons Kalshi prefers the term traders over bettors.
“It’s somewhat interchangeable, but we tend to use ‘traders.’ It’s a bit more accurate,” Such noted.
Kalshi’s contracts pay out real money, but unlike the stock market, they’re not tied to an underlying asset. Their value shifts solely based on the perceived likelihood of an outcome.
How does it work?
Kalshi allows users to buy and sell contracts, most of which are priced between 1 cent and $1, based on how likely people think an outcome is.
Traders buy “yes” or “no” positions, and then when the event happens, the contract pays out to whoever was right.
For example, let’s say you think California Gov. Gavin Newsom will be the Democratic nominee for president in 2028. Right now, you can bet that will happen by purchasing a “yes” contract on Kalshi for 20 cents.
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If Newsom wins and accepts the nomination, then the market resolves to yes, and holders of “yes” contracts get paid out. Someone who bought a 20-cent “yes” contract would receive five times their money.
On the other hand, if you don’t think Newsom will be the nominee, you can buy a “no” contract. Since that’s the more likely outcome at the moment, “no” contracts are pricier, currently around 81 cents.
But like stocks, contract prices fluctuate, sometimes minute to minute. If news breaks suggesting Newsom is more likely to be the nominee, you can expect “yes” contracts to rise in price.
What can you bet on?
Kalshi currently offers around 2,800 markets covering a wide range of subjects, from politics and sports to entertainment and health.
Users can buy contracts on high-stakes events — like the New York City mayoral race — or lighter topics, such as who will be the next James Bond or who will go on Joe Rogan this year.
The prediction-market platform has a team that decides which markets to launch and also takes suggestions from users.
“Anything that’s relevant, we will try to have a market on it if it’s legal,” Such said.
As of this writing, artificial intelligence and Pope Leo XIV are neck-and-neck favorites to win Time magazine’s 2025 Person of the Year.
Are any topics off-limits?
Prediction market platforms have faced criticism for what some view as the gamification of tragedy — an opportunity for traders to profit from others’ misfortune.
Earlier this year, prediction platform Polymarket allowed users to place wagers related to the Los Angeles wildfires and even included a “wildfire” trending module.
The decision sparked outrage online, with some condemning it as morally wrong, while others worried that financial incentives could encourage arson.
Kalshi says certain subjects — such as war, death and terrorism — are off-limits to avoid creating perverse social incentives.
If there were a market allowing bets on whether someone would die by a certain date, it could instantly make that person a target.
“That’s very bad, we don’t want that,” Such said.
While Kalshi doesn’t offer wildfire markets, users can place wagers on natural disasters like hurricanes where human actions don’t influence the outcome, Such noted.
“These are huge economic events that cause destruction, and it’s important to have a form of insurance on them,” he said.
