Prediction markets take a (premature) victory lap

TL;DR: Kalshi and Polymarket are taking a post-midterms victory lap, claiming they “called” races faster than the networks. But their record is more mixed than their bragging suggests, and the blue wave they (kinda) saw coming could just bring them tougher regulation.

What happened: Prediction markets’ latest forecast: They’re faster than the news. After the election on Tuesday, Kalshi and Polymarket separately boasted that they beat mainstream news outlets to accurately declaring projected winners. (As a disclaimer: Prediction markets can’t actually “call” races. Their odds just show where traders are putting money.) Polymarket claimed that in 10 key races, its odds hit 99% by a median of 31 minutes before the AP, CNN, and Fox News called them. Kalshi’s cofounder said its platform was already projecting near-total confidence about which party would control the Senate and House by the time the infamous New York Times needle went live.

Meanwhile, analysts told Bloomberg that these platforms have a pretty mixed track record on elections overall, with odds often just tracking the polls they claim to be beating. (Plus, one expert said the markets undershot the size of the blue wave in the midterms.) Still, both sites framed themselves as scrappy underdogs sounding the death knell for the slow, outdated decision desk call—making a case for their legitimacy just as criticism of these markets is ramping up.

The bet so far: Prediction markets have been angling to be taken more seriously for a while, and it’s working. Not only was nearly $1.9 billion traded on these sites for the 2026 midterms, one recent Brennan Center-funded survey found that prediction markets strongly swayed people’s view of which candidates are electable.

The House always wins?: Even if Kalshi and Polymarket are counting the midterms as a win, the industry’s light-touch regulation might not last. In 2026, a growing number of states have sued, fined, or sent cease-and-desists to prediction markets, including Utah, which filed criminal charges against Kalshi and its cofounders in late October.

A slate of new Democratic attorneys general and a Dem-controlled Congress could also speed up scrutiny and regulation: Dems have filed most of the prediction market bills introduced to Congress since 2025, and prediction market expert Dustin Gouker foresees “a lot of congressional hearings.”

Bottom line: Americans may have watched Kalshi and Polymarket odds on election night, but that doesn’t mean they welcome the platforms. Per the Brennan survey, 87% of voters want prediction markets regulated more tightly—or banned outright. —WK