The American publication More Perfect Union (MPU) has released a video investigation into prediction markets. The investigation was prompted by Polymarket’s proposal to integrate the platform’s odds into MPU reports.
Instead of collaborating, the journalists scrutinized Polymarket’s business model and public statements by the company’s head, Shayne Coplan. They concluded that prediction platforms exploit Americans’ economic anxieties under the guise of “financial democratization.”
Forecast Accuracy Lower Than Claimed
The authors cited a study by Vanderbilt University concerning the 2024 U.S. elections. According to its findings, Polymarket’s forecast accuracy was 67%, while Kalshi’s was 78%. The older platform, PredictIt, showed a much higher result of 93%.
The journalists noted that Coplan had given an interview to the program 60 Minutes, calling prediction markets “the most accurate tool humanity has at the moment.”
The report also mentioned the February U.S. employment report. Market participants predicted an increase of 60,000 jobs, but the actual difference from the final figure was 150,000.
Insider Trading as Part of the Model
Economist Robin Hanson, one of the ideological inspirations behind modern prediction markets, stated in the video that insiders on such platforms are the norm.
U.S. Senator Chris Murphy commented to MPU, describing prediction markets related to government decisions as inherently unfair:
“All bets on government actions are rigged because someone in the government knows the outcome. Many other bets are also rigged — a small circle of influential people knows the result in advance.”
Murphy believes that contracts where thousands of people know the result in advance should not be traded at all.
In March, Kalshi and Polymarket announced new measures to combat insider trading. Experts interviewed by MPU doubted that the platforms could control tens of thousands of potential insiders across all types of markets — from video game releases to Spotify streaming statistics.
0.04% of Traders Take 70% of Profits
The publication provided data showing that 0.04% of traders receive about 70% of the profits on prediction markets. According to a report by Citizens Bank, clients of these platforms lose more money in the first three months of trading than users of traditional sportsbooks.
Journalist and author of the U.S. gambling industry newsletter The Closing Line, Dustin Gouker, stated that 85-90% of Kalshi’s turnover is in sports. For Polymarket, this figure is about 40%. Gouker described the activity as gambling, regardless of how the platforms themselves label it.
Regulation and Lobbying
Federal regulation through the U.S. Commodity Futures Trading Commission (CFTC) exempts platforms from local taxes and player protection requirements. For comparison, in New York State, bookmakers pay a 51% tax and are required to implement tools to combat gambling addiction.
This inequality has already sparked conflict with state authorities — Kalshi has faced lawsuits from more than a dozen states demanding its activities be recognized as unlicensed gambling. However, the CFTC maintains the status quo, and Donald Trump Jr. serves as a strategic advisor to both Polymarket and Kalshi.
In February, Polymarket opened a free grocery store in New York. MPU journalists visited the location during the video shoot and assessed the event as an attempt to draw Americans’ attention to the gambling platform.