Survey: 79% of Prediction Market Users Lost Money, Half Borrowed to Fund Bets
A BadCredit.org survey found that 79% of prediction market users lost money over the past year, with 27% losing more than $500. It also found 51% borrowed money — credit card, loan, or other — to fund trades, and 88% of those borrowers lost. Over half (53%) started using the platforms to earn extra income or because they were struggling financially. The findings offer consumer-harm evidence that contrasts with the platforms' investment-tool framing and may be cited by state regulators.
A survey of prediction market users by BadCredit.org found that 79% lost money over the past year, with 27% losing more than $500. Its most striking findings concerned borrowing: 51% of users said they used a credit card, personal loan, or other borrowed money to fund trades, and of those who borrowed, 88% lost. The survey also found 53% began using prediction markets to earn extra income or because they were struggling financially — a motivation profile closer to problem gambling than to the hedging and forecasting use cases the platforms emphasise in their regulatory arguments. The findings were widely reported across US media in early October 2026.
For UK readers, the borrowing figures are the headline concern. UK-licensed gambling operators are subject to Gambling Commission affordability and responsible-gambling requirements precisely to catch borrowing-to-bet behaviour: the Commission has moved toward affordability checks, and credit-card gambling has been banned in Great Britain since 2020. A product where half of users borrow to participate and 88% of borrowers lose would trigger immediate regulatory concern under the UK framework. The core issue is that CFTC-regulated prediction markets are not subject to responsible-gambling rules at all, because the CFTC regulates them as commodity exchanges, not gambling operators — so none of the deposit limits, affordability checks, self-exclusion tools, or credit-funding restrictions that apply to licensed gambling apply to Kalshi or Polymarket.
The survey sits in tension with a September Pew Research Center finding that most prediction market sports traders break even or post small losses, based on nearly 12,000 trading accounts. The two are not necessarily contradictory: Pew analysed actual account-level data (capturing small, frequent, near-zero traders), while BadCredit.org used self-reported outcomes (which may over-represent users who feel losses acutely). But the divergence matters for policy — Pew's data supports the platforms' modest-harm argument, while the survey supports the regulators' meaningful-harm argument, particularly through the borrowing-to-bet finding.
For the regulatory debate, both sides can use the survey selectively. Platforms will argue self-reported data is less reliable than account-level analysis, that the sample may be unrepresentative, and that losing traders are inherent to any market. State regulators will argue the borrowing rate and financial-distress motivation are hallmarks of gambling harm, and that the absence of responsible-gambling protections on CFTC-regulated platforms leaves consumers exposed. The survey does not change the legal question — CFTC preemption does not turn on whether users profit — but it strengthens the public-interest case state attorneys general are building, and it is the kind of evidence that could shape how the CFTC itself approaches responsible-trading requirements as the sector matures.
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Recent updates
Google Adds Prediction Market Ad Policy — CFTC License Required, Ads Blocked in Five States
Google published a dedicated prediction markets section in its advertising policy on October 15, requiring domestic operators to hold a CFTC Designated Contract Market licence to run ads — favouring Kalshi and Polymarket US over unlicensed rivals. Google also bars prediction market ads targeting five states where enforcement is most active: Connecticut, Michigan, New York, Ohio, and Nevada. The policy makes Google's ad platform mirror the state enforcement map, using commercial access as a de facto regulatory layer.
Kalshi Partners With Signify to Police Athlete Harassment, Codifies Anti-Abuse Rule
Kalshi announced a partnership with Signify Group on October 15 to monitor social media for abuse and threats directed at athletes, coaches, and sports personnel across the NFL, NBA, MLB, NHL, and ATP Tour. Kalshi notified the CFTC of a new rule, dated October 13, codifying athlete harassment as an 'impermissible activity', with sanctions up to financial penalties and permanent account closure. The move follows a September appeal by five major leagues and their players' unions for lifetime bans on abusive bettors.
CFTC Moves to Classify Event Contracts as Swaps — Attempting to Settle the Core SCOTUS Question by Rule
The CFTC, led by Chairman Michael Selig, moved on October 9 to explicitly classify event contracts as swaps under the Commodity Exchange Act, placing prediction market contracts under federal swap regulation. The scope covers sports, political, cultural, and weather contracts, while a separate provision excludes casino-style gambling and sportsbook wagers. Selig said the aim is to remove 'any ambiguity.' The action targets the exact question dividing the federal circuits and now before the Supreme Court — whether event contracts are 'swaps.'