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To better understand the impact these kinds of betting websites like Polymarket are having, we're joined now by Kate Nibbs.
She's a senior writer at Wired.
Kate, thank you so much for joining us tonight.
There's a lot of talk surrounding the Polymarket right now, especially since this recent arrest.
What How would you explain what Polymarket is to someone?
Yes, so Polymarket is a platform where you can trade contracts on the outcome of future events.
And the events can range from who's going to win the Super Bowl, who's going to win an Oscar, who's going to win the US presidential election, to geopolitical events like will the Strait of Hormuz stay open, will Ayatollah Khamenei remain in power.
There are even markets on what news anchors will say during their broadcast.
So, I don't I haven't checked, but there might actually even be a market on this broadcast.
It's a wild world.
It definitely is.
And there are two prediction markets.
Is that right?
It's There's Polymarket and then there's a US-based market called Kalshi.
Who And who can take part in this?
Can it be anyone?
So, those are the two leading markets in the United States.
They're by far the biggest.
Kalshi is fully US-regulated, so people in the United States are legally allowed to participate in all 50 states.
There's actually a lot of legal battles going on right now because there are various states that say that people shouldn't be able to participate on sports event contracts.
They say that that's sports gambling.
But for now, Kalshi US, everyone can do it.
Polymarket is interesting because it's also based in the United States, but most people in the United States are not allowed legally to use Polymarket's crypto-based platform, which is where all of these trades are taking place.
Like the soldier who was arrested was arrested for trading on the crypto-based platform that he was actually never supposed to be on to begin with.
Okay.
But it is open to anyone.
Anyone can place a bet.
So, what is the impact that you're seeing with these kinds of websites or prediction markets?
Or what what type of impact is that making here in the US?
So, obviously there's a huge kerfuffle over all of the suspected insider trading that's raising a lot of alarm about widespread corruption in the government.
Various sports leagues are concerned that allowing wagers on you know, their games could corrode the integrity of the whole like sporting event.
It's It's pretty serious concerns about just what these are doing to public trust.
And in addition to those concerns, when it comes to sports events markets, there's just a lot of very reasonable worries that people are going to be losing all their money betting on sports using prediction markets.
And as we saw with that soldier, there are legal dangers surrounding these prediction markets.
Polymarket was banned in the US from 2022 to 2025 and is currently banned as you mentioned in some countries.
How is it regulated now that it's operating again here in the US?
So, thought there's two different versions of Polymarket.
There's a smaller version that is allowed in the United States and it's invite-only and it is fully regulated by the Commodity Futures Trading Commission, which is the federal agency that regulates all prediction markets.
But then the larger Polymarket, the one that all of these insider trades are taking place on, that is outside of the US jurisdiction.
And so, the soldier that made the Maduro bets, he was using a virtual private network and disguising where he lived and pretending to live in another country in order to participate on on Polymarket.
So, there's been a lot of confusion about whether US authorities would actually go after all of the suspicious activity on that offshore version of Polymarket.
Today's arrest shows that actually they will be pursuing people who do insider trading on the offshore version of Polymarket if they live in the United States, but there there has been a lot of confusion about what jurisdiction that falls under.
Kate, thank you so much for your time.
Really appreciate it.
We've learned a lot about Polymarket.
We really needed that.
Senior writer with Wired, thank you.
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