SBJ Betting: Kalshi’s $1 billion-a-day World Cup surge

Problem gambling diagnoses are up more than 60% in states that have legalized sports betting, while they’ve fallen 29% in those that have not, according to an analysis of health records of more than 197 million U.S. adults released Friday morning.

The largest increase was among 18-29-year-olds, whose rates doubled.

It’s important to note that diagnoses rates are miniscule: 4.8. per 100,000 in states that legalized vs. 2.2 per 100,000 in states that haven’t. Diagnosed problem drinking rates are close to 1 in 10.

Still, the fact that diagnoses have spiked in legalized states — revealed in a large, credible study of an often undiagnosed problem — puts meat on the bones of previous examinations of call rates to problem gambling help lines, which often were explained away as examples of expanded services working as intended.

Making an addictive product more readily available and advertising it heavily was bound to increase problem behavior, particularly among those who are most vulnerable.

“You increase access, you increase problems,” Mark van der Maas, a Rutgers professor who has studied the link between gambling and suicide, told NBC News.

Now that you can bet on sports legally in 50 states, there’s a good chance the gap between “legalized” states and others will close.

And not because either number went down.

It appears the Californians, Texans, Georgians and others who have been boxed out of legal online sports betting have discovered Kalshi’s World Cup prediction market offering. And, based on the girth of the numbers, there’s a decent chance some consumers and deep-pocketed market makers in legalized states have been drawn to the rhythm of its swaying soccer prices, too.

Kalshi recorded $1 billion to $1.25 billion in sports volume each day from June 17 through Wednesday, according to tracking data from crypto news site The Block. The NBA Finals concluded June 13, meaning that volume likely was almost entirely from the World Cup. It was during the Finals that Kalshi posted its first $1 billion day.

Converting prediction volume to sportsbook handle is something between a developing science and the toss of a dart. But the model that well-regarded gambling research firm Eilers & Krejcik is working on estimates that U.S. prediction markets had generated the equivalent of $1 billion in sportsbook handle from World Cup matches through June 24.

Heading into Friday, about 42% of the tournament’s 104 scheduled games remain.

In a research report issued earlier this week, analysts from Bank of America’s global research division estimated that Kalshi was doing about $125 million in volume per World Cup match, including parlays, which they said accounted for about 35% of Kalshi volume.

Friday morning, Kalshi announced that it would add its branding to the rotating World Cup signs of FIFA official sponsor ADI Predictstreet, an offshore site not licensed to operate in the U.S. The announcement also teased future U.S. expansion for Predicstreet through Kalshi’s CFTC-licensed exchange.

“Bottom line, Kalshi’s sports penetration is accelerating,” analysts wrote, “and is potentially on pace to do more equivalent ‘handle’ on the World Cup than all of online sports betting, as compared to Kalshi reaching (about) 20% of OSB handle during March Madness.”

BofA said Kalshi’s overall prediction market share was 80%, with Polymarket at 7%, Robinhood’s Rothera exchange at 7% and Crypto.com at 2%. It estimated DraftKings registered $175 million to $200 million in prediction volume last week.

Those hungry for a deeper dive into World Cup prediction numbers, including an interesting rundown of the more popular parlay constructions from Kalshi, can find a good one here from sports betting news site InGame.

Per that report, the eight most popular parlays all lost.

Fanatics says it will suspend or banish account holders who are caught harassing players, coaches or officials through a service introduced by integrity monitoring platform ProhiBet, an IC360 brand best known for blocking pro and college players from betting on their sports.

Launched in conjunction with London-based online threat monitoring firm Signify Group, ProhiBet will flag abusive bettors, notifying participating sportsbooks, which can then restrict them from wagering. Signify, which also works with the NCAA, says it will monitor for malicious betting-related posts on X, Instagram, Facebook, Tik Tok and YouTube, as well as collecting direct messages forwarded by targeted athletes, coaches and officials.

Fanatics, which like other larger U.S. sportsbooks already has policies against abusive behavior by its customers, said it intends to launch in time for football season.

A 7% year-on-year decline in Illinois was enough to drag U.S. sportsbook handle into the red for the fifth consecutive month in April.

Sportsbooks in legalized states took $13.09 billion in bets, down from $13.19 billion in the same states last year. Counting Missouri, which opened in December, handle for April was $13.37 billion, down 12% from March.

The sudden reversal, which has ranged from 1% to 5%, was preceded by seven consecutive months of double-digit year-on-year gains. December marked the first time handle had fallen year-on-year since February of 2023, when it dropped 1%.

May isn’t looking any better. With results reported in 24 of 33 states, May handle is down 2% compared to the same month last year. New Jersey and Pennsylvania were down 10% and 9%, respectively. Michigan was an outlier, gaining 18%.

• Kalshi is looking to raise funds at a valuation nearing $40 billion after it brought in $1 billion at a $22 billion valuation last month.
• Survivor contest operator Splash Sports will add Polymarket prediction markets to its platform in time for football season through a deal that also includes sponsorship of the popular seasonlong NFL contest.
• The New Yorker tells the story of Tim Pughsley, whom it calls “America’s Last Bookie,” chronicling how he built a gambling empire ... and how his hubris led to its downfall.
• A New Mexico lawmaker asked tribes and pueblos to renegotiate the state’s gaming compact, which only permits sports betting at tribal casinos, to legalize online gambling, per Source New Mexico.
• Bettors in North Carolina could be facing higher taxes if Gov. Josh Stein signs a bill the state Senate passed Tuesday that affects tax enforcement on several industries, reports WRAL-TV of Raleigh.