World Cup Bettors Have Stuck Around at Kalshi After the Tournament
World Cup fans on Kalshi haven't realized it's time to go home yet.
Much ado has been made about the volume of World Cup betting that took place on Kalshi and other prediction markets, but the acquisition of new customers may outweigh direct profits from the tournament.
Analysis by Gaming America shows that growth in non-World Cup market volumes from the weeks before the tournament to the weeks after was double the normal rate. In effect, Kalshi’s current trading volume is nearly six weeks ahead of where it would have been had the tournament not happened, assuming a continuation of the prior trend.
Kalshi’s daily volume hit an all-time high of $2.1 billion on July 11, a week before the World Cup final. Total trading on World Cup markets across the duration of the tournament exceeded $12 billion.
But even since the final blast of the referee’s whistle, daily trading on Kalshi has averaged north of $1.1 billion. That’s roughly twice what the daily average was in May.
There is also circumstantial evidence, based on the composition of that volume, that much of the additional trading comes from new users. Markets on less-popular international soccer leagues make up more of the overall sports volume than they did previously, and more than they do for traditional sportsbooks. That suggests a more internationally-minded demographic than the traditional American sports audience.
Yet it isn’t only soccer that has benefited, or even just sports. Crypto, politics, and other non-sports markets also grew 73% from the period just before the tournament to the period just after.
Kalshi’s Already-Explosive Growth Doubled Over World Cup
Kalshi volume has come down considerably since the end of the World Cup. However, it has returned to a baseline that’s considerably higher than it was before.
The graph above makes that visually obvious. Granted, the World Cup period was 39 days, longer than any single month, so the pre- and post- columns are slightly more than two months apart. However, the numbers don’t lie.
From January until just before the tournament began, the growth of non-World Cup markets on Kalshi averaged to 0.55%. From the portion of June before the tournament to the portion of July after it, the daily average was 1.08%, nearly twice the rate.
Single bets on non-World Cup sports had been growing at just 0.23% per day. Over the course of the tournament, they grew at 0.64%, nearly triple. Parlays had been growing at 1.30% and accelerated to 1.52%. Even non-sports markets, which had been growing at 0.99%, saw a boost to 1.32%.
Shifting Demographics Apparent in International Soccer Markets
Prior to the World Cup, it was typically only the American MLS and the most popular foreign leagues cracking $100,000 in daily volume on Kalshi: EPL, UEFA, occasionally Ligue 1 or Bundesliga, etc. Since the tournament ended, Gaming America has observed a large number of smaller or less-watched leagues creeping in: Poland’s Ekstralasa, the Scottish Premier League, Paraguay’s División de Honor, to name just a few.
Soccer as a whole went from about 7.6% of Kalshi sports volume before the tournament to 11.2% after. In part, that’s the result of the NBA postseason concluding. However, other sports, like MLB, did not see their share increase.
Moreover, much of the increase for soccer came from those other, formerly less popular leagues. Filtering out the top ten most popular soccer tickers from before the tournament, we see these miscellaneous international leagues nearly double in popularity, from 3.4% of overall sports to 6.5%. The top ten tickers, meanwhile, only went from 4.2% to 4.7%.
Either the World Cup brought more fans of these international leagues onto the platform, or existing soccer bettors followed their favorite players from the tournament back to their home leagues.
Can Prediction Markets ‘Out-DFS’ the Daily Fantasy Companies?
To some extent, the apparent demographic differences between current Kalshi sports traders and traditional sportsbook users are good news for both industries. If users are drawn to prediction markets for slightly different reasons than they are to sportsbooks, both could potentially coexist.
However, the trend toward tennis and international soccer might be short-lived. We’ll have to see what happens in a month once the NFL season starts.
The more important point of differentiation between the two is that Kalshi is legal in places that the regulated sportsbooks aren’t. In particular, California and Texas are huge, previously almost untapped markets. Eventually, those states may join the sports betting fold, but Kalshi and its ilk will have enjoyed a substantial head start. Being available for World Cup has certainly compounded that advantage.
Investors’ worries about that first-mover advantage are likely to blame for the sportsbooks’ tumbling share values. DraftKings, for instance, is down 34% year-to-date, despite its revenue continuing to grow in established markets.
The irony, there, is that DraftKings and its rival FanDuel are where they are precisely because they employed a similar strategy a decade ago to sneak into markets. Daily fantasy sports was, before the fall of the federal ban on sports betting, what prediction markets are today.
If the World Cup effect proves not to be a temporary honeymoon for prediction markets, those companies that got their start in DFS may find themselves beaten at their own game.
Ticker Tracker provided assistance with classifying Kalshi markets for this report.
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