Word that U.S. sports predictions market dominator Kalshi popped a record volume number on last weekend’s Masters got me thinking about why golf seems to be punching above its weight on that prediction market, and whether there’s a takeaway that says something about the sport’s potential as a betting product.
Like traditional sports betting, prediction markets percolate based on how much betting interest there is in an event. The Super Bowl and March Madness are good parallels. But prediction market volume also rises based on how often bettors — in some cases larger entities that are treating the sports results the way they would other commodities futures — move in and out of contracts throughout an event.
In the case of a football game, they might take an undervalued team at a lower price — i.e., long odds — at kickoff and then trade out of the position early in the third quarter, when the price on the team has risen, i.e., the odds have dropped. At a sportsbook, that’s called live, or in-play betting. It’s catching on. But it’s not the dominant approach, as it is for those fueling prediction markets.
Think about how that approach applies in golf. The window for most betting around a football or basketball game is about four hours wide, starting in the hour before kickoff or tipoff, as bettors check final injury reports, weigh trends and put on lucky socks, and continuing through the end of the game. The window for betting on a PGA Tour event is four days.
Four hours vs. four days.
I’m going to refill my coffee while you process that.
Four hours vs. four days.
It stands to reason that if that dynamic is driving volume on Kalshi, it should be stoking in-play betting on DraftKings, FanDuel and other sportsbooks.
A timely check-in with Scott Warfield, VP/Gaming at the PGA Tour (and 2021 SBJ Forty Under 40 honoree), confirmed that suspicion. Handle on Tour events, not counting the Masters, which does its own thing, is up 33% vs. this time last year. Number of bets is pacing 18% ahead. The number of people betting is up 15%.
So when Kalshi recorded $545 million in volume on the Masters, beating the most recent Super Bowl (not counting Bad Bunny bets and other assorted silliness), Warfield didn’t raise an eyebrow.
“Considering we’re coming off WM Phoenix Open, which was our most bet-on PGA Tour event of all time — and that lasted all of one month until the Players, which became the most bet-on PGA Tour event of all time — I’m not sure I was surprised,” said Warfield, who has been beating the drum for golf in-play education since joining the tour in at the start of 2021. “There is certainly a bit of wind at the back in terms of golf betting.”
Warfield pointed to golf fans learning the betting menu and bettors seeing how in-play applies to golf for the growth. He also credited sportsbooks’ broad adoption of the PGA Tour’s data product, which moved to Sportradar this year when it acquired IMG Arena, and their increasingly visible placement of it on their apps. This year’s expansion of the tour’s betcast channel as an all-day alt feed during the tour’s higher purse “signature” events likely also has helped.
New frontiers
Last month, the tour made significant in-roads in golf-mad Florida, where the state’s lone sportsbook operator, Hard Rock Bet, finally expanded its data deal with Sportradar to include its full suite of golf odds and in-app animation that allows bettors to track all 18 holes in near real time.
“The impetus of all of those content [expansions] was to educate people that it’s not set-it-and-forget-it,” Warfield said, referring to the days when the only golf bets were prematch odds on tournament winners. “It can be set-it-and-forget-it. But it also can be set it, and change it, and add to it, and alter it throughout a four-day period.”
Kind of like prediction markets, right?
That’s the next frontier that the tour now must contemplate. MLB chose its path shortly before Opening Day, when it carved prediction markets out as its own sponsor category, signing an exclusive deal with Polymarket and beginning work on an authorized designation for other operators. The NHL did deals with Kalshi and Polymarket at the start of its season. The NBA and NFL are deep into reviews of their respective approaches.
Ball in government’s court
Considering the uncertain legal grounds underpinning sports predictions, waiting as long as possible may be the prudent course. But a determinant ruling, which could eventually come from the Supreme Court, could take years. Or, best case, a year. When and if it does come, it could go either way.
And with Congress taking a closer look at the CFTC, as it did Thursday during this House Ag committee hearing, there’s a chance sports betting is punted off the CFTC’s menu before it ever gets that far.
Like Nate Bargatze says, nobody knows.
In an equation chocked with variables, the one constant is that the CFTC and Chair Michael Selig, the only commissioner in place on a board that is supposed to have five of them, will cling tightly to agency’s purview over sports prediction contracts until the Supreme Court, the Trump administration or Congress demands that he let go. The good news for the leagues is that he appears willing to put in place guardrails similar to those around sports betting and will give them a say in what they look like.
Those who wait may get more clarity. But they also may be sacrificing large sponsor checks from well-funded prediction market operators eager for their blessing and their valuable digital pipeline to fans.
“We’ve always been analyzing and looking at trends as they develop, and that would include what has happened in the last 24 months with CFTC-regulated products,” Warfield said. “Like the other leagues, there are a ton of things for the PGA Tour to consider that we’re working through, from regulatory framework to integrity to commercial. We’re going through the process. I’m not sure there will ever be an end date. I don’t have a timeline. We will move at the pace that is right for our sport, our company and our stakeholders, including players and tournaments.”
