Professional Gamblers Move Into Prediction Markets to Bleed You Dry

"Following the federal government's wide-armed embrace of the tech, professional gamblers are flooding into prediction markets like Kalshi and Polymarket. It's not hard to see why: in January alone, trading volume on Kalshi almost hit $10 billion, $8.5 billion of which was tied to sports, according to new reporting by Bloomberg. That same month, Kalshi saw three million new downloads. The waters, in other words, are teeming with prey - and the sharks are moving in."

"No longer content to ply their trade on the predatory betting apps of yore - the FanDuels, DraftKings and BetMGMs of the app world - professional gamblers have discovered a lucrative new playground in the wildly unregulated land of prediction markets. "It really feels like everything's prediction markets, prediction markets, prediction markets," Rufus Peabody, a professional gambler with 15 years of experience told Bloomberg. "Maybe not for the average recreational bettor, but certainly in the sharp community.""

"In gambling parlance, "sharps" are the pros: the full-time bettors who win more often than they lose. And for these gamblers, prediction markets represent a whole new ecosystem of marks, like you, who have far less information and expertise to devote to making well-informed bets than they do. As Bloomberg notes, traditional sports books take the other side of every wager they collect. Prediction markets, however, pit bettors against each other, resembling something closer to Wall Street than to seedy betting parlors."

Professional gamblers are flooding into prediction markets such as Kalshi and Polymarket, drawn by rapid growth and large trading volumes. In January, trading volume on Kalshi almost hit $10 billion, $8.5 billion of which was tied to sports, and Kalshi recorded three million new downloads that month. Traditional sportsbooks take the other side of every wager; prediction markets instead pit bettors against each other, creating a marketplace structure similar to Wall Street. "Sharps" — full-time bettors who win more often than they lose — find significant advantage and alpha in these largely unregulated markets, treating them as a lucrative new playground.

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