Sports Combos Dominate Trading At Kalshi & Polymarket During Midterms
Photo by Myron Mott on Unsplash
Prediction markets made their big splash during the 2024 US presidential election. Sports subsequently became their lifeblood, and that was crystal clear during this week’s midterms.
Analysis done by Legal Sports Report found that Kalshi generated $1.1 billion in election trading, which accounted for just 3% of total volume in the 10 days surrounding the midterms. Meanwhile, $25.3 billion in sports combos were traded during that span.
The top-five political markets accounted for approximately 54% of Kalshi’s overall election trading:
- Texas Senate: $145 million
- House control: $137.5 million
- Congressional balance of power: $111 million
- Texas governor: $100.8 million
- Senate control: $96.7 million
Sports Continue To Be King At Kalshi & Polymarket
As the top election market, the Texas Senate race generated less trading than 16 NFL games did with live bets this season. Prediction markets have also leaned heavily on parlays, which they refer to as combos. A GuardianBlock analysis found that sports accounted for 99.3% of combo trading from Sept. 1–19.
Fancy a flutter on what prediction markets would look like without sports? That would appear to be a grim proposition for Kalshi and Polymarket. The latter saw 88% of its overall trading on sports and combos during the 10-day period that ended on Election Day. Political markets generated just 1.3% of total volume.
Last month, Kalshi said election trading was growing six times faster than football trading and that it had surpassed 2024 levels. Bloomberg later reported that the volume was comparable.
Thinking Beyond Sports
Bank of America recently indicated that sports account for about 80% of all volume at prediction markets. Despite that, some industry executives are bullish on the future without sports as the lynchpin. Additional growth areas include crypto prices, corporate earnings, weather risks, and economic announcements.
Robinhood VP JB Mackenzie noted that there is new demand for trading products aside from sports. He added that a “revolution” is ongoing for products in politics, business, and financial markets.
“The products that we’re building today are going to be looked at sort of like dinosaurs in less than probably two or three months,” Mackenzie said.
Wall Street research and brokerage firm Bernstein’s most recent forecast stated that sports will account for just 38% of overall trading volume by 2035.
Given the current landscape, it’s difficult to envision that. It remains to be seen whether sports have a long-term future at prediction markets. For now, anyway, they have no real competition when it comes to generating volume.
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