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Better Markets is calling for states and tribal jurisdictions to regulate prediction markets, arguing that platforms market betting as investing while bypassing gambling advertising safeguards.
Its statement singles out Kalshi’s influencer messaging and criticizes the role of the Commodity Futures Trading Commission (CFTC).
Wednesday‘s statement accompanies a new fact sheet titled “Deceptive, Predatory Marketing Practices Show Why States Should Regulate Prediction Markets.” It is an advocacy call for regulatory action, not an announcement of a new rule or enforcement decision.
Better Markets Targets Influencer Marketing
Andres Chovil, a policy analyst for Better Markets, said prediction markets are appealing to young Americans who see betting as a route to financial gains.
“As financial nihilism takes root among some young Americans, prediction markets are capitalizing by disguising betting as investing,” Chovil said.
The group alleges that sponsored influencer content uses fear of missing out to recruit users. It specifically says Kalshi instructs influencers to describe contracts as “predictions on outcomes,” rather than bets, picks or wagers. Chovil argues that this language misleads users into viewing betting as legitimate investing.
To illustrate its concerns, Better Markets cited two surveys:
- A Betterment survey found that 52% of Gen Z investors reported redirecting money intended for investing toward sports betting.
- A U.S. Bank study found that 33% of Gen Z respondents and 29% of Millennials would consider using prediction markets to build wealth.
Those figures describe different behaviors: reported sports betting in the first survey and willingness to consider prediction markets in the second. The statement does not provide the studies’ sample sizes or methodologies.
Advertising Safeguards Are Central to the Call
Better Markets argues that labeling gambling-style bets as traded event contracts allows prediction market platforms, with CFTC support, to avoid state and tribal advertising requirements. It identifies responsible gaming disclosures and gambling helpline requirements as protections at issue.
For users, the group’s concern centers on how products are presented and what risk information accompanies their promotion. Better Markets also says most prediction market users lose money, although the supplied statement does not provide supporting figures.
Chovil urged federal regulators to allow state and tribal jurisdictions to regulate gambling.
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Source: As reported by Better Markets.
