Most US Prediction Market Users Report Financial Losses

The findings from BadCredit.org arrive during a period of record-breaking volume on platforms like Kalshi and Polymarket, where trading activity reached $50.59 billion in July alone. While these markets are marketed as sophisticated event-contract venues, the survey indicates that the primary driver for many participants is simple financial necessity. Roughly 53% of users reported entering the space to generate income, with nearly one in ten citing financial hardship as their motivation for betting on election outcomes, economic releases, and sports.

Debt plays a central role in the user experience, with 51% of respondents using credit cards or personal loans to finance their positions. Among this group, the failure rate climbed to 88%, compared to 69% for those who utilized their own cash. Erica Sandberg, a consumer finance expert, warns that borrowing to speculate on uncertain events creates a compounding risk, as interest payments often persist long after the initial wager is lost. She characterizes the use of credit for such contracts as a fundamentally flawed financial strategy.

While the industry maintains that these platforms operate under federal oversight—often positioning themselves as derivatives markets rather than gambling sites—the reality for the average user remains volatile. Academic research into millions of accounts suggests that profits are highly concentrated, with fewer than 4% of participants capturing the majority of gains. As federal regulators and state authorities continue to clash over the legal status of event contracts, the survey serves as a stark reminder that for the vast majority of retail participants, the promised financial upside remains elusive.