Regulators have taken note of Polymarket and Kalshi’s profits from sports betting, prompting them to portray themselves as pioneers of the news industry.
Substack has strengthened its collaboration with Polymarket by introducing tools for sharing and discussing prediction market data on its platform. Polymarket will pay creators, including Matt Yglesias, to utilize this data through Substack’s sponsorship program.
Prediction markets are increasingly merging with media. Dow Jones incorporated Polymarket data into its content, including The Wall Street Journal. CNN used Kalshi’s betting odds, and CNBC partnered with Kalshi. Nate Silver, a poker player and former stats journalist, is now an advisor for Polymarket.
This intrusion of prediction markets into journalism could blur the lines of what constitutes news. Vlad Tenev, CEO of Robinhood, envisions prediction markets as the next step in news evolution, emphasizing economic value.
It’s crucial to distinguish news as a record of past occurrences. News does not predict; it reports on recent events. Pseudo-events like awards or press conferences are often covered because they fill the news cycle, despite being predictable. Such events resemble polls more than news, aiming to stir discussion but not necessarily convey factual occurrences.
In the 2024 election, prediction markets forecast Trump’s victory against Harris, contrasting with traditional media’s uncertain stance. Some advocated betting markets as alternatives to polls, deeming the odds as insights into public confidence.
Advocates of betting markets argue they incorporate insider information, illegal in traditional markets, and pose legal challenges. The CFTC plans to resist state efforts to regulate insider trading in prediction markets, which they believe alter news consumption.
Betting markets financially reward those with insider knowledge but disadvantage uninformed participants. News outlets collaborating with betting platforms risk prioritizing profits over public service, potentially diluting journalistic integrity.
Ultimately, the legitimacy of betting markets as news parallels the preference for pseudo-events over reality, raising concerns about their impact on trust in factual reporting.