Last Week Tonight With John Oliver (2014) s13e08 Episode Script
Prediction Markets
Welcome to "Last Week Tonight"!
I'm John Oliver, thank you so much
for joining us. We are back!
And it has been a busy week.
Eric Swalwell's political career
justifiably imploded.
A jury found that
Live Nation runs a monopoly,
which is no surprise to anyone
who's ever had to deal with them.
And Hungary's Viktor Orban
was kicked out of office,
with one moment in the aftermath
catching everyone's attention.
The shackles are off, and they're
dancing to a different tune.
This viral video of Hungary's
expected new health minister
encapsulating the party mood.
I love it.
Celebrating an autocrat's downfall
by dancing like your drunkest uncle
during the last 20 minutes of a wedding
is incredible.
And while I am happy for Hungary,
I'm also a bit jealous.
Because they're getting
this guy as their health minister,
while we are stuck
with this beefy creep
who just this week we learned once cut
the penis off a road-killed raccoon.
As a purely vibes-based matchup,
we have lost heavily.
Meanwhile, our tentative ceasefire
with Iran seems to be holding so far,
though as of taping,
the Strait of Hormuz remains in chaos,
with "dueling blockades"
from the U.S. and Iran
causing widespread confusion.
Even the pope has now seemed
to criticize the war, saying quote,
"Whoever is a disciple of Christ,
the Prince of Peace,"
"never stands on the side of those"
"who yesterday wielded
the sword and today drop bombs."
It was one of a series of statements
that made Trump lose his shit.
First, he posted this screed,
which began with,
"Pope Leo is weak on crime."
Which, in terms of insults,
just doesn't work.
It's like saying this possum is weak
on Balkan geography.
Okay, but who gives a shit?
It's not a possum's job
to correctly place Bosnia
and Herzegovina on a map.
Her job is to eat garbage,
hang upside down,
and by this evidence, fuck.
But Trump wasn't done.
Because he then posted this image,
which understandably generated
fierce backlash.
And his excuse was pretty weak.
Tonight, President Trump is defending
his social media post
of this AI-generated image
that depicts him as Jesus Christ.
I did post it, and I thought
it was me as a doctor,
and had to do with Red Cross.
There's a Red Cross worker
there, which we support.
That makes sense. A doctor.
You know how when
you go to the doctor,
and you get checked in by
a nurse and a few bald eagles,
and then the doctor comes in
and he's wearing an ancient tunic,
and says, "We're going to get you
started on antibiotics"
"and on orbs of light borne from my
very skin. Take them with food."
You know, the doctor.
Meanwhile, caught in the middle
of all this was JD Vance,
who actually
has a new book coming out
that's literally about his decision
to convert to Catholicism,
with, fun fact, a stock photo
of a Methodist church on the cover.
Now, when pressed on the pope's
remarks, Vance took a bold swing.
When the pope says
that God is never on the side
of those who wield the sword,
there is a thousand-year-a-more
than a thousand-year tradition
of just war theory. Okay?
Now, we can, of course,
have disagreements
about whether
this or that conflict is just,
but I think that it's important,
in the same way that it's important
for the vice president of the US
to be careful
when I talk about
matters of public policy,
I think it's very important
for the pope
to be careful when he talks about
matters of theology.
Yeah, that is JD Vance
douchesplaining theology to the pope.
Which is objectively crazy. It'd be
like me explaining to JD Vance
where the clit is
on a Togo sectional.
Why would I even try to do that?
He's spent his life devoted
to this very subject.
I'm out of my lane there!
Also, "be careful"?
The pope's got a lifetime gig.
He doesn't need to be cautious
about what he says.
He could start tweeting,
"Where's the album?" at Rihanna
every day for the rest of his life,
and that still wouldn't change the fact
he's considered the Vicar of Christ.
Literally the only thing he should
probably be careful about
is not meeting with JD Vance,
because historically,
that has been fatal for popes.
But incredibly,
the president still wasn't done.
He reposted this AI image of Jesus
hugging him, which had the caption,
"I was never a very religious man,
but doesn't it seem,"
"with all these Satanic, demonic, child
sacrificing monsters being exposed,"
"that God might be playing
his Trump card!"
Which, for someone
who was repeatedly photographed
with society's buzziest
child-sacrificing monster,
is a bold thing to repost.
And on Thursday, he couldn't
resist taking one more swing.
Before leaving for Las Vegas,
the president was asked
about his feud
with the pope over the war.
I'm not fighting with him.
The pope made a statement.
He says Iran can have
a nuclear weapon.
I say Iran cannot have
a nuclear weapon.
Pope Leo has never said Iran
should have a nuclear weapon.
Pressed on whether he'd be willing
I don't think it's necessary.
Yeah, I don't really think
it's necessary either.
This battle of words
has not gone well for Trump.
Plus, I don't think they'd see
eye to eye on much,
other than maybe whether it's
a good idea to cover your workplace
in more gold shit than seems
physically possible.
The point is, Trump seems to be
on an epic run of picking losing fights
and whatever air of invincibility
he had last year is fading fast.
All of which is a pretty good
reminder that one day,
he is gonna be gone,
and on that day,
it will be time to,
as I believe the phrase now goes,
dance like a Hungarian
health minister. And now, this.
And Now:
Local Pittsburgh Newscasters
Try to Pronounce
Their Ballpark's New Snack.
The team unveiled a slew of new
food options available at PNC Park.
Some of the new food items
include the Bori-cua Dog.
The Boricula Dog brings
a bit of Puerto Rican flavor.
A Borkia Dog. This is a Puerto Rican,
inspired hot dog.
Then there's the Bori-cua Dog.
The bor-the Borcula Dog.
The Boriqua Dog?
Boriqua Dog?
They include a Boricua Dog.
This is this Puerto Rican-inspired
hot dog here with a Pittsburgh twist.
Moving on. Our main story tonight
concerns prediction markets,
the fast-growing platforms where you
can bet on basically anything,
as this TikToker explains.
I've been making a ton of money
on this app
that lets you bet on anything
in the world.
I bet that GTA 6
won't be released on time.
I bet that Trump would pardon
Young Thug this year.
I'm predicting Delta Airlines
will be the first airline
to sell Zyn on their flights.
I made money off Trump
being elected president,
and 'cause Kamala Harris
didn't go on Joe Rogan's podcast.
When I was in New York, I bet it
would rain and it did, so I won money.
I bet that Justin Bieber
would go to the Diddy trial.
When I was in Chicago, I bet
on the temperature and won.
Okay, shoutout to that guy,
Caden Booth,
for having
such a diverse set of interests.
The first half of his bets
are strictly Gen Z boy:
Grand Theft Auto,
Young Thug, Zyn, Rogan.
But the back half is 100% suburban
mom: potential rain, the temperature,
grisly celebrity trials.
Cade, you contain multitudes.
Prediction markets are basically
platforms where you can wager
on the outcome of future events.
The companies decide
on the questions to list,
and right now, you can
wager on anything from,
"Will traffic in the Strait of Hormuz
return to normal by the end of April?"
to "Will the U.S. confirm that aliens
exist before 2027?"
These markets have seen exponential
growth in recent months,
logging billions of dollars
in bets every week.
You may have heard about them
on the news, or seen ads,
or stumbled across
influencers like this guy,
who is constantly updating
his followers
on how his various wagers about
the Trump administration are going.
And I'll warn you,
it's a real rollercoaster.
China question. Please!
High-end Nvidia chips to China.
But the Wall Street Journal
My hero!
The president has made his position
on this very clear, both to the Chinese,
that's not something we're interested
in selling to China at this time.
Yes! Yes!
Yes! Barack Hussein Obama!
I'm getting rich off Jeffrey Epstein.
The files dropped? Yeah!
Is Donald Trump named in
the files? They're all redacted?!
Yeah! A lot more screaming
than you thought, there, huh?
And it's kind of amazing to witness
someone absolutely furious
that Trump's name was redacted
from the Epstein files
for a completely different
reason than the rest of us.
The point is, a lot of people are
getting into prediction markets,
thanks in part to
an aggressive marketing push
by the two big players in this
space, Kalshi and Polymarket.
Kalshi recently locked in a
22 billion valuation from investors,
doubling its valuation
from just a few months earlier,
and Polymarket's currently
trying to do the same.
Meanwhile, dozens of new
entrants-like Coinbase, Robinhood
and even Truth Social, are also
trying to get in on the action.
It is shocking the extent to which
prediction markets have proliferated,
and sometimes
it's been a little unnerving,
given the things
that you can now bet on.
Ali Khamenei out as supreme
leader of Iran?
Will Nancy Guthrie's kidnapper
be arrested by the end of February?
Those are just two events offered
on popular prediction markets
in the U.S.
over the last couple of weeks,
where people could have put their
money down, betting on the outcome.
There's a lot of bad stuff
going on in the world,
and being able to bet on just
When somebody's gonna be found?
That's really dark to me.
Yeah, he's right. The impulse to try
and make money betting on war,
or an unfolding tragedy,
is really dark.
When someone dies, you're supposed
to send their family a card
that says, "Sorry for your loss",
and not one that says,
"Thanks for covering the spread!"
That's just one of many issues
associated with these sites,
and given that, tonight,
let's look at prediction markets
and try to answer a few questions
that you might have:
where exactly
did these sites come from,
what purpose, if any, do they serve,
and how on Earth is any of this legal?
And let's start with the fact
that the broad concept
of prediction markets on
news events is nothing new.
In the late '80s, economists
at the University of Iowa
created the Iowa Electronic Markets
as an experiment,
allowing students and faculty
to buy and sell predictions
about upcoming elections,
and interestingly,
they began to outperform
many leading polls.
The theory was that
"the wisdom of crowds",
in the form of people putting actual
money behind their opinions,
can produce useful forecasts.
And controversial uses of these
markets are not new, either.
After 9/11, the Pentagon actually
flirted with creating a market
where experts could wager
on future events,
hoping it could help predict
events in the Middle East.
But it quickly got shut down, once
members of Congress found out about it
and voiced their disgust.
This betting parlor on
the internet will include wagers,
for example, as the examples
on the internet site
put up by the Department of
Defense would include,
"Will Mr. Arafat be assassinated?"
"Will there be missile attacks
from North Korea?"
"Will the king of Jordan
be overthrown?" Just as an example.
I think this is unbelievably stupid.
That is a gentle thing to say about
a program that is so devoid of value.
It combines the worst of all of our
instincts, in my judgment.
Yeah, he was justifiably upset
at the notion of people betting
on geopolitical events
that would affect millions of lives.
As we all know, the only groups
that society's decided are allowed
to profit from instability
are military contractors,
members of the Trump family,
and the Mormon wives.
Whitney joined the cast of "Chicago" on
Broadway and Taylor gets announced
as the bachelorette,
and then notably unannounced?
I don't know how these women do it,
but I cannot stop watching.
The point is, back then,
the concept of betting on grim
outcomes seemed beyond the pale.
But everything started
changing a few years ago,
when Kalshi and Polymarket
launched as startups,
opening the door to the free-for-all
that we have now.
Initially, Kalshi sought regulatory
approval, and in 2020,
it was approved
as the first regulated exchange.
But Polymarket went a different way,
launching without approval,
and seeming to be comfortable
working outside the rules.
The government accused Polymarket
of operating an unlicensed exchange,
and as part of a 2022 settlement,
it agreed to pay 1.4 million
and block Americans
from trading on the platform,
while admitting no wrongdoing.
And it is worth watching
Polymarket's CEO, Shayne Coplan,
try and spin that penalty.
- It was a settlement.
And you could not have
customers in the United States.
Yeah, we had to go and geo-block
trading in the U.S.
and move certain operations
offshore.
And it wasn't, "Hey, you're banned
from trading in the U.S."
- It's like, "Until you're licensed."
- It was breaking the law.
People say "breaking the law."
It's like, "Which law," you know?
- So, if anything, it's incompatible.
- It's incompatible with the law.
Yeah, with the regulatory matrix
that existed.
Look, "incompatible with the law"
is clearly ridiculous,
but please don't overlook the line
"People say breaking the law,"
"and it's like,
'Which law,' you know?"
I'm sorry, what? I'm pretty confident
there is a specific law you broke,
given, you know, you paid
a 1.4 million penalty.
Regulators weren't just like,
"Shit, he just asked which law."
"The Chinese Exclusion Act
of 1882?"
From the start, Polymarket took
an extremely libertarian approach,
allowing users to use crypto to bet
anonymously on things like war.
And while it's currently rolling out
a new app to U.S. users
that does have government approval,
it is way more limited and
mostly offers trading on sports.
The vast majority of its business
is still done on Polymarket's
international version,
which is based offshore in Panama,
and on which American users
have to mask their location
if they want to trade.
And while doing that might be
a high technological bar to clear
for someone like me,
using a VPN is something anyone
under 25 learns to do
before they learn how to write
a cursive capital G,
mostly because that is an impossible
letter invented by someone
who wanted
to make children suffer.
It looks like someone stabbing himself
in the stomach with a pencil,
because that's exactly what trying to
write that letter makes you want to do.
But regardless of how these
companies got to this point,
both enjoyed a huge surge of attention
about a year and a half ago,
after this happened.
Kalshi made a name for itself
in the 2024 election.
Just over one week away
from Election Day,
and the race is neck and neck.
It looked close, unless you were
keeping an eye on Kalshi,
which called the race well before
the TV networks did.
It was like, Kalshi, then Fox,
then CNN.
- How did that feel?
- It was crazy.
Yeah, Kalshi predicted Trump would
win, as did Polymarket,
whose CEO then tweeted,
"Make no mistake,"
"Polymarket single-handedly called
the election before anything else."
"The global truth machine is here,
powered by the people."
And while it is not the most
important thing,
you have now met the CEOs
of these two companies,
and I'm just gonna say it:
they are two of the most
"extras in a Totino's Pizza Rolls
commercial"-looking motherfuckers.
Anyway, since then, they've both been
scrambling for market dominance,
which is why Kalshi, for instance,
has run TV ads like this.
Indiana gonna win, baby!
We're in Florida asking people
what they put their money on!
I'm all in on OKC!
Indiana got that dog in 'em!
- Will egg prices go up this month?
- I think we'll hit 20 dollars.
How many hurricanes do you
think we'll have this year?
Kalshi!
Kalshi!
Kalshi lets you legally trade on
anything, anywhere in the U.S.
OKC!
Indiana!
OKC! Kalshi!
Okay, that visual cacophony
is an AI slop atrocity.
It contained two alligators,
four shirtless or nearly shirtless
old guys, one egg freak,
three different people
being pursued by the police,
one woman I'm kind of rooting for,
one USDA inspector's
fucking nightmare,
and one alien seemingly rooting for
Duke, which, honestly, tracks.
And the whole thing ends with,
"The world's gone mad, trade it",
although given everything
that came before,
a more honest tagline might've been,
"Fuck empathy, get money. Kalshi."
And again, that is the one
that likes to present itself
as the more buttoned-down,
rule-abiding company of the two.
And at this point,
you might be thinking,
"Wait, isn't that
an ad for a gambling site?"
But both Kalshi and Polymarket
will fiercely argue
that that's not
what they are at all.
They argue that gambling involves
playing against "the house",
while their users are trading
against each other,
with the companies typically
just charging a fee on trades.
They'll also insist
that they're simply modern versions
of commodity futures markets, which
have been around for over a century.
If you're not familiar with them,
they're a place
where people can speculate
about the future price of things
like corn or natural gas.
Crucially, they will argue that the bets
they sell are financial instruments
that enable ordinary people
to hedge against future risks,
like betting that,
say, a hurricane will hit,
or that the U.S. government
will shut down.
Here's how Kalshi's CEO frames it.
We had a market
about whether student loans are going
to be forgiven or not this year.
And so, a lot of people were
hedging using that market.
And so, if it wasn't forgiven,
they would get paid some amount
of money that they could use
to basically pay the student loan.
And that's why this is very important.
Right. Apparently,
they're just trying to help people
make wise planning decisions.
It's the kind of responsible financial
thinking that you intuitively associate
with a company that advertises itself
with a shirtless old man being arrested
or an alien pledging Sigma Chi.
And look,
that might make some sense
when you're talking about
an economic indicator
or a specific event that might
impact you personally.
But what exactly is the financial loss
that I'm hedging against
if I bet on the next winner
of "The Masked Singer"
or on whether or not Mr. Beast
will say "Feastable"?
And when you watch some
of Kalshi's actual customers in action,
the notion that this is about sober
risk management feels absurd.
I tell you,
if I didn't win this election
and if you had a moron like Kamala
Yeah!
Number one, Sleepy Joe!
We're looking good so far.
Easy, bro. Okay. All right.
- We made about 200 bucks.
- Okay. All right.
Men playing in women's sports.
Wait!
We are off to a great start!
We hit
on that shit immediately!
"Sleepy Joe," "transgender."
We got "Sleepy Joe" and "transgender"
in like the first five minutes, bro.
- Bro, we're up like 500 bucks.
- We gotta make 1,000.
- Yeah, we gotta make 1,000.
- All right.
I couldn't even tell you what
this man is saying.
Like, he just says
a soup of random words.
Somehow Joel is just deciphering this
and just making money.
Yeah, that is not using a financial
instrument to hedge risk.
It's taking advantage
of a sundowning geriatric's
rapidly declining verbal abilities.
You bet he's gonna say
the word "nasty"? Great guess, dude,
it's one of the last 200 words
he has left.
Honestly, that clip is unsettling
on multiple fronts.
One, because
the president's harmful rhetoric
is being divorced from
its actual meaning, but two,
because that's not what these
bros are supposed to be doing.
They shouldn't be betting
on Trump speeches,
they should be sitting
on that same couch
and watching YouTube highlight reels
of Kevin Love outlet passes,
six Modelos in, forging a deep,
beautiful friendship
that will last 40 years and that
they will never, ever discuss.
Nature has lost its course.
The point is,
that sure looks like gambling.
And it is pretty telling that, while
political "mentions markets" like that
get a lot of attention,
around 90% of trading volume
on Kalshi is on sports.
But you can see why
these companies are so insistent
that they are not gambling sites.
Just 39 states, D.C., and Puerto Rico
have some form
of legalized sports betting,
with only 32 of those
allowing online gambling,
leaving some pretty attractive
mega-states like California and Texas,
on the table.
And by insisting
they are financial exchanges
offering not bets
but "event contracts",
prediction markets are not only
able to operate in states
where gambling isn't legal,
but also get around state taxes
and minimum age requirements
in states where it is.
And they've sometimes talked out of
both sides of their mouth on this.
Because in ads like this one,
Kalshi's called itself
"the first nationwide
legal sports betting platform."
But when asked about it, it later
tried to qualify that statement,
"that any financial position can be
considered a 'bet' on the future."
And that is so dumb,
it is almost charming.
It's like seeing a sign outside a strip
club that says, "Girls, girls, girls",
and then seeing the manager
come out and say, "We meant,
"Girls, girls, girls who code."
"We support women in STEM."
Sure you do, buddy. Nice try.
But these companies' insistence
that they are not gambling platforms
is one of the two most irritating
claims that they tend to make.
The other is that they're actually
incredibly important to society,
because they can help us
more accurately predict the future.
The head of Polymarket's
even called it,
"The most accurate thing
we have as mankind right now"
and has bragged that the predictions
it generates can save lives.
When I get hit up by people
in the Middle East who are saying
that, "We're looking at Polymarket"
"to decide whether we sleep
near the bomb shelter."
"Like, we look at it every day."
And I'm like,
"It's really that popular over there?"
They're like, "Are you kidding me?"
"Do you not know what's going on?
Everyone's relying on this."
That's very powerful.
That's an undeniable value proposition
that did not exist before.
Quick question: what
exact stage of capitalism are we in
when the child CEO of an offshore
gambling platform
refers to betting odds on bombings as
an "undeniable value proposition"?
Because it feels like we're in
palliative care at this point.
But I guess
that is the point you reach
when you're a 27-year-old billionaire
surrounded by yes men
who will never tell you the truth,
something I know for sure
because no one in his life told him
never to ever wear that jacket,
which, when he is sitting like that,
unmistakably says "peed rider".
Though for all the talk of these
sites' unparalleled accuracy,
you should know,
that's a bit of an oversell.
They have shown promise
in some areas,
a paper found Kalshi's predictions
were "roughly consistent"
with those of professional forecasters
when it came to the economy
and Federal Reserve policy.
But they've also
had some big misses.
For instance, both favored the Chiefs
to win last year's Super Bowl,
and also whiffed the recent
Texas Republican Senate primary,
with Polymarket even posting
a breaking alert that morning,
announcing Ken Paxton
was projected to win,
with their odds giving him
an 83% chance.
And, you know, he didn't do that.
And look, all of that would be fine,
these are just odds,
and real life can defy odds,
were it not for the fact
that these companies
are actively selling themselves
as basically oracles.
And they've even tried
to bolster that reputation
by entering paid partnership deals
with news organizations.
Dow Jones, parent company
of the Wall Street Journal,
announced a partnership with
Polymarket earlier this year,
while CNN, CNBC, and Fox News
all signed deals with Kalshi,
which even sponsors segments
on CNN that feature Kalshi's odds
on various future events scrolling
across the bottom of the screen.
And I do not want the CNN ticker
to have betting odds on news events.
I don't really want anything on there,
except maybe the odd distractingly
weird headline that takes my
mind off things for a second.
You know, something like,
"Giraffe escapes from zoo,
police say it has a gun."
You know,
something fun to Google later.
But having their logo
like that on CNN
is a big win for Kalshi.
Just as it's a big win for them to have
influencers like that guy from earlier
saying how easy it is
to win money.
Though you should know,
after we asked, Kalshi told us
that they paid him for that post.
And it feels like deals like those
should really be more transparent.
It makes me a little annoyed, and
to be honest, even more hungry.
And you know, when I need
something nutritious, yet in a can,
I know where to turn:
Bush's Baked Beans.
But full disclosure:
I was paid 40 dollars to say that.
The thing is, it's worth knowing
that, in reality, as with sportsbooks,
researchers have found that most users
of Kalshi and Polymarket lose money.
As we've discussed before,
casual gamblers
are always going to be easy prey
for more sophisticated operators with
advanced systems to give an edge.
Which is probably why,
while Polymarket has more
than two million users,
one analysis found more than
two-thirds of all money won on it
was held by just 740 accounts.
And if you're thinking,
"How exactly are these companies
getting away with all this?"
A lot has to do with who
is in the White House right now.
Both companies have fostered strong
connections with the Trump family,
in fact, Don Jr. is both an investor in
and an unpaid adviser to Polymarket,
and a paid adviser to Kalshi.
And look, I am not saying
that Don Jr. isn't providing
important or valuable insights,
although, in a much truer sense,
I very much am saying that.
I'm just saying, it's notable
just how hard it was for Kalshi's CEO
to answer a series of basic
questions about Don Jr.'s role.
Why did you guys make Donald Trump
Jr. a strategic advisor?
We have a lot of advisors,
and they span across the board,
across different functions.
But really, this is all about
growing this industry,
the prediction market industry,
that a lot of people really believe in.
What kind of advice
does he give you?
So, it really is, again,
about growing prediction markets.
He believes in prediction markets.
We believe in prediction markets.
A lot of people believe
in prediction markets,
and it's really about go-to-market
and expansion plans.
Does he come to meetings?
How much do you pay him?
What's his role? I mean,
this is the son of the president.
We, again, I mean,
we have a lot of advisors.
And whether it's our investors,
whether it's people
But he's not just any advisor. He has
a direct line to the White House.
We have a lot of advisors.
Yeah, turns out, it's pretty hard
to justify hiring a nepo baby,
or, in Don Jr.'s case,
"a nepo divorced dad".
But the thing is, if hiring Don Jr.
helped get these companies
on Trump's good side, it's a bet
that's paid off massively for them.
Because while the Biden administration
had at least tried
to rein in some of what
these markets were doing,
the Trump administration has
gone hard in the other direction.
And to understand the degree
to which that's the case,
take a look at the CFTC, or Commodity
Futures Trading Commission.
It regulates these platforms.
And it was actually empowered,
under the Dodd-Frank Act in 2010,
to block event contracts
about terrorism, assassination,
war and gaming.
You know, a bunch of what
you've seen so far tonight.
But it is clearly not doing that,
and it doesn't even seem to be trying.
In fact, while the CFTC's "supposed
to be comprised of 5 commissioners,"
"two of whom are required
to belong to the minority party,"
it currently only has this guy,
Michael Selig,
a Trump appointee who's a massive
cheerleader for this industry.
He completely buys into their whole
"this is about hedging risk" argument,
to the point that he once suggested
that somebody with a medical condition
could "manage the potential risk"
"of having a future treatment
or medical costs"
by placing a bet on the likelihood
of something passing a drug trial.
Which is, and I don't say this lightly,
one of the most fucked up suggestions
I have ever heard for this country's
Guernica-ass healthcare system.
And while Selig's recently made noises
about stronger enforcement,
it is hard to take him at his word,
given that,
during his confirmation hearings,
he told Congress
he'd let courts decide whether these
companies constitute gambling.
But in office, he's done the exact
opposite of that,
in fact, more than a dozen states are
currently suing prediction markets,
but rather than let that play out
in the courts like he promised,
Selig posted this video.
To those who seek to challenge
our authority in this space,
let me be clear,
we will see you in court.
What a fucking weasel.
That guy has both the energy
and fashion sense of a "Suits" villain
who goes toe-to-toe with Harvey
and Mike all season long
while Louis and Meghan Markle,
I don't care what you say, that's
her character name to me, watch on.
But he's done more
than just threaten.
Selig's led his agency to sue
three states
to get them to back off trying
to regulate prediction markets.
So right now, these companies
are able to operate
under extremely
friendly conditions.
And given that, it's worth looking
at some of the problems
that have already begun to emerge,
starting with the fact that,
for a lot of these bets,
it is incredibly easy
for individuals to manipulate
the outcomes.
Some have even joked about that.
For instance,
on a recent earnings call,
the CEO of Coinbase said this.
I was a little distracted because
I was tracking the prediction market
about what Coinbase will say
on their next earnings call,
and I just want to add here
the words Bitcoin, Ethereum,
blockchain, staking and Web3,
to make sure we get those in
before the end of the call.
Yeah, he saw people's bets online
and just rattled off words
that they'd bet on him saying.
And it really feels like manipulating
betting outcomes
should be more difficult
than that.
In the old days, you at least had
to sneak cocaine to a racehorse,
not just rattle off a list
of the most punchable words
in the English language.
We even realized, while
researching this piece,
that there was betting
happening around this show,
specifically, on what words I'd say
during our show on February 22nd.
Which is stupid for multiple reasons,
including that we tape on Saturday,
in front of a studio audience,
all of whom would then have
a massive information advantage
and more than 24 hours before
the betting window closed.
Now, thankfully, we wipe every
audience member's memory
before we let them out of the taping.
We try to erase
only the last couple of hours,
but sometimes we do wipe clean
a milestone birthday.
That's on us, and we're constantly
calibrating the technology.
You've been warned. You won't
remember, but you've been warned.
There are markets where it is too easy
for anyone to manipulate outcomes.
Just last summer, you might remember,
a bunch of assholes
started throwing dildos on the court
during WNBA games
to promote a crypto meme coin.
And if that wasn't already
a cursed enough sentence,
I'll let this South African man fill
you in on what happened next.
Did you know that you can actually
bet on whether a dildo
will be thrown at the WNBA game
on August 9th,
August 11th, that's today,
and August 12th?
Right here on Polymarket.
I had no idea.
Actually, I had no idea what
the WNBA was either,
until you could place a bet on whether
a dildo would be thrown at it.
Yeah, none of that is great.
And it is pretty depressing
that the way he learned
about the existence of the WNBA
was finding out you could bet
on whether a dildo would be
thrown at one of its games.
It'd be like finding out about
the existence of Robert De Niro
by Googling
"the cast of 'Dirty Grandpa'."
No, don't. Not like this.
Don't learn about him like this.
But it is true. People started betting
whether dildos would be thrown again
and Polymarket even put up
this tweet promoting the bets.
And sure enough,
more dildos got thrown.
And that could well have been
because Polymarket had just created
a situation where
you could easily make money
by betting someone
would throw a dildo,
and then going to a game
with a dildo and throwing it.
There've also been multiple instances
of people seeming to use
inside information
to game these markets.
Last year, a trader made
over a million dollars
with a series of accurate bets
about Google's rankings
of its most searched people of 2025.
That same person, by the way,
had also earned over 150,000
by predicting the exact release
date of Google's Gemini 3 model.
Which really makes you think
that that person
either worked for Google,
or knew someone who did,
or maybe managed
to hack Google from the outside,
in which case, would it kill you to do
a Google doodle for my birthday?
It is on Thursday, by the way.
And Polymarket's CEO has,
in the past, openly celebrated
the fact that this kind of thing
can happen on his platform,
because he's argued it just makes
its prediction abilities much stronger.
What do you guys do, if anything,
to guard against insider trading?
Yeah. So, it goes back to this
idea of information markets, right?
Like, you think about,
"When will Gemini 3 launch?"
Nobody is under the impression
that nobody knows the answer, right?
Like, of course,
there's people who are working on it
who know when it's gonna come.
And I think what's cool
about Polymarket
is that it creates this financial
incentive for people to go
and divulge the information
to the market,
and the market to change, and all
When you say divulge, you mean
the people who actually know?
Yeah, or someone tells someone
and then the market responds.
Yeah, he basically just answered
the question,
"How do you guard against insider
trading?" there with "No".
And he did it with a fashion choice
even worse than his biker jacket,
because what in the NYU army
fatigues is that shit?
That sweater looks like it was made
from illegally poached Grimace.
But also, I don't care how many
statement sweaters you wear
or how many "Ben Platt in 'Dear Evan
Hansen'" haircuts you have,
you're not describing some edgy
chill way to divulge information.
You're describing insider trading.
And it gets genuinely chilling
when you realize that people seem
to be using insider info
to bet on life-or-death events.
In January, after the U.S.
seized Nicolas Maduro,
an anonymous trader pocketed more
than 400,000 dollars
off bets that that would happen,
with the bulk of those bets made
mere hours before
the raid was announced.
In February,
two Israelis were charged with
using classified military information
to place bets on Polymarket.
And in March, this happened.
Deadly American strikes,
and some people may have
made money from them.
More than a dozen anonymous
accounts placed bets
predicting that the US would strike
Iran by Saturday the 28th of February.
Most of those wagers were placed in
the hours before the first bombs fell.
And many of the accounts had
been created only days earlier.
One of the biggest winners used
the account name "Magamyman".
The trader placed 87,000 dollars
on a war with Iran
exactly 71 minutes before
the first strike,
winning a jackpot
worth 515,000 dollars.
Yeah, that sure feels
like someone with inside information
was betting on Polymarket.
And I'd say that it wasn't a great idea
to make their username "Magamyman",
except it doesn't seem
to matter anymore, does it?
His username
might as well have been
"Magamyman, just kidding,
my name is Dylan Barthwell"
"and I work at the Department of
Defense." He's not really risking much.
Now, I should say,
Kalshi just announced
it took action
in two insider trading cases,
and has taken out billboards
bragging that it bans insider trading
and also that it doesn't offer
death markets.
Which is a little weird.
It'd be like McDonald's putting up ads
that its nuggets
"don't contain baby meat".
Okay, mama, but now I have
way more questions.
For its part, Polymarket recently
updated its rules to clarify
that users can't act on stolen
confidential information,
wager using illegal tips,
or bet if they're in a position to
influence the outcome of an event.
Although it is not a great sign
that just recently,
there was a suspicious spike
in trading
right before the ceasefire
with Iran was announced,
as "a group of new accounts on
Polymarket made highly specific,"
"well-timed bets" about it, earning
hundreds of thousands of dollars.
So, it sure seems like right now,
we've effectively got gambling sites
operating even in states
where gambling is illegal,
and offering bets on things
that there've been laws against
for over a decade now.
So, what can we do?
Well, at the bare minimum,
the CFTC should be doing more,
and while it says it's writing new
rules, I wouldn't expect much,
especially for as long as this
fucking guy's in charge.
As I said earlier,
there are a bunch of cases
making their way through
the courts right now,
but it's not clear how they'll resolve
and it's probably going to be
in front of the Supreme Court.
Meanwhile, Congress is considering
a number of proposals
tackling aspects of this issue,
although,
given that the president of
the United States has a kid
advising both major companies,
I wouldn't hold your breath.
So, meaningful policy shifts
in the near term do seem unlikely.
But at some point, we do need to put
in place some basic guardrails here.
And until then, if we can't change
how these sites operate,
we should at least try and change
how we individually see them.
One thing that would frankly help
is if news organizations
stopped laundering these companies'
reputations for them
by putting their odds on screen
like they are actual news.
Because is it a bad idea for them
to be doing that?
If I may quote the single loudest
Yes!
Yes. Exactly. I couldn't
have screamed it better myself.
And look, on a personal level,
if you're considering
using these markets to gamble,
try and remember that you are
statistically likely to lose money.
And while
I am not against gambling per se,
there is something so grim
about these sites
turning every aspect
of our lives into a bet.
Because, sure, money
can be won on them,
but in that happening,
something also gets lost.
Specifically, a society where things
aren't only weighed in financial terms
and where people engage with news
for what it means to human beings,
not just because they have
50 dollars riding on it.
And when something unexpected
happens in the world,
it would be really nice
not to have to automatically question
whether it's only because someone
is trying to move a market.
That is why I'm going
to make you a promise tonight:
I will never do anything because
someone online placed a bet on it.
So, you can be confident
that if I ever say
"Bitcoin, Ethereum, blockchain,
staking, and Web3",
it won't be because
I'm trying to move markets,
it'll be because
I'm having a stroke.
And once you have that trust,
you can feel secure in the knowledge
that if a dildo ever
lands on this desk,
it's not because someone had
a secret wager on it.
It's because we weren't sure how
to get out of a 32-minute segment
on a quasi-legal gambling industry,
but we knew that a thrown dildo,
in the right circumstances,
and with the full consent of the person
having it thrown at them,
would be undeniably funny.
And if more than one dildo lands,
it'll only be because
a fundamental rule of comedy is
"more dildos is more funny".
And if it turns out there are too
many dildos flying through the air,
I promise, it will only be because
we didn't know how many to buy,
and now we're sort of screwed,
because I don't think
you're allowed to return them.
That is our show,
thank you so much for watching,
see you next week, good night!
This is just too many dildos!
I'm John Oliver, thank you so much
for joining us. We are back!
And it has been a busy week.
Eric Swalwell's political career
justifiably imploded.
A jury found that
Live Nation runs a monopoly,
which is no surprise to anyone
who's ever had to deal with them.
And Hungary's Viktor Orban
was kicked out of office,
with one moment in the aftermath
catching everyone's attention.
The shackles are off, and they're
dancing to a different tune.
This viral video of Hungary's
expected new health minister
encapsulating the party mood.
I love it.
Celebrating an autocrat's downfall
by dancing like your drunkest uncle
during the last 20 minutes of a wedding
is incredible.
And while I am happy for Hungary,
I'm also a bit jealous.
Because they're getting
this guy as their health minister,
while we are stuck
with this beefy creep
who just this week we learned once cut
the penis off a road-killed raccoon.
As a purely vibes-based matchup,
we have lost heavily.
Meanwhile, our tentative ceasefire
with Iran seems to be holding so far,
though as of taping,
the Strait of Hormuz remains in chaos,
with "dueling blockades"
from the U.S. and Iran
causing widespread confusion.
Even the pope has now seemed
to criticize the war, saying quote,
"Whoever is a disciple of Christ,
the Prince of Peace,"
"never stands on the side of those"
"who yesterday wielded
the sword and today drop bombs."
It was one of a series of statements
that made Trump lose his shit.
First, he posted this screed,
which began with,
"Pope Leo is weak on crime."
Which, in terms of insults,
just doesn't work.
It's like saying this possum is weak
on Balkan geography.
Okay, but who gives a shit?
It's not a possum's job
to correctly place Bosnia
and Herzegovina on a map.
Her job is to eat garbage,
hang upside down,
and by this evidence, fuck.
But Trump wasn't done.
Because he then posted this image,
which understandably generated
fierce backlash.
And his excuse was pretty weak.
Tonight, President Trump is defending
his social media post
of this AI-generated image
that depicts him as Jesus Christ.
I did post it, and I thought
it was me as a doctor,
and had to do with Red Cross.
There's a Red Cross worker
there, which we support.
That makes sense. A doctor.
You know how when
you go to the doctor,
and you get checked in by
a nurse and a few bald eagles,
and then the doctor comes in
and he's wearing an ancient tunic,
and says, "We're going to get you
started on antibiotics"
"and on orbs of light borne from my
very skin. Take them with food."
You know, the doctor.
Meanwhile, caught in the middle
of all this was JD Vance,
who actually
has a new book coming out
that's literally about his decision
to convert to Catholicism,
with, fun fact, a stock photo
of a Methodist church on the cover.
Now, when pressed on the pope's
remarks, Vance took a bold swing.
When the pope says
that God is never on the side
of those who wield the sword,
there is a thousand-year-a-more
than a thousand-year tradition
of just war theory. Okay?
Now, we can, of course,
have disagreements
about whether
this or that conflict is just,
but I think that it's important,
in the same way that it's important
for the vice president of the US
to be careful
when I talk about
matters of public policy,
I think it's very important
for the pope
to be careful when he talks about
matters of theology.
Yeah, that is JD Vance
douchesplaining theology to the pope.
Which is objectively crazy. It'd be
like me explaining to JD Vance
where the clit is
on a Togo sectional.
Why would I even try to do that?
He's spent his life devoted
to this very subject.
I'm out of my lane there!
Also, "be careful"?
The pope's got a lifetime gig.
He doesn't need to be cautious
about what he says.
He could start tweeting,
"Where's the album?" at Rihanna
every day for the rest of his life,
and that still wouldn't change the fact
he's considered the Vicar of Christ.
Literally the only thing he should
probably be careful about
is not meeting with JD Vance,
because historically,
that has been fatal for popes.
But incredibly,
the president still wasn't done.
He reposted this AI image of Jesus
hugging him, which had the caption,
"I was never a very religious man,
but doesn't it seem,"
"with all these Satanic, demonic, child
sacrificing monsters being exposed,"
"that God might be playing
his Trump card!"
Which, for someone
who was repeatedly photographed
with society's buzziest
child-sacrificing monster,
is a bold thing to repost.
And on Thursday, he couldn't
resist taking one more swing.
Before leaving for Las Vegas,
the president was asked
about his feud
with the pope over the war.
I'm not fighting with him.
The pope made a statement.
He says Iran can have
a nuclear weapon.
I say Iran cannot have
a nuclear weapon.
Pope Leo has never said Iran
should have a nuclear weapon.
Pressed on whether he'd be willing
I don't think it's necessary.
Yeah, I don't really think
it's necessary either.
This battle of words
has not gone well for Trump.
Plus, I don't think they'd see
eye to eye on much,
other than maybe whether it's
a good idea to cover your workplace
in more gold shit than seems
physically possible.
The point is, Trump seems to be
on an epic run of picking losing fights
and whatever air of invincibility
he had last year is fading fast.
All of which is a pretty good
reminder that one day,
he is gonna be gone,
and on that day,
it will be time to,
as I believe the phrase now goes,
dance like a Hungarian
health minister. And now, this.
And Now:
Local Pittsburgh Newscasters
Try to Pronounce
Their Ballpark's New Snack.
The team unveiled a slew of new
food options available at PNC Park.
Some of the new food items
include the Bori-cua Dog.
The Boricula Dog brings
a bit of Puerto Rican flavor.
A Borkia Dog. This is a Puerto Rican,
inspired hot dog.
Then there's the Bori-cua Dog.
The bor-the Borcula Dog.
The Boriqua Dog?
Boriqua Dog?
They include a Boricua Dog.
This is this Puerto Rican-inspired
hot dog here with a Pittsburgh twist.
Moving on. Our main story tonight
concerns prediction markets,
the fast-growing platforms where you
can bet on basically anything,
as this TikToker explains.
I've been making a ton of money
on this app
that lets you bet on anything
in the world.
I bet that GTA 6
won't be released on time.
I bet that Trump would pardon
Young Thug this year.
I'm predicting Delta Airlines
will be the first airline
to sell Zyn on their flights.
I made money off Trump
being elected president,
and 'cause Kamala Harris
didn't go on Joe Rogan's podcast.
When I was in New York, I bet it
would rain and it did, so I won money.
I bet that Justin Bieber
would go to the Diddy trial.
When I was in Chicago, I bet
on the temperature and won.
Okay, shoutout to that guy,
Caden Booth,
for having
such a diverse set of interests.
The first half of his bets
are strictly Gen Z boy:
Grand Theft Auto,
Young Thug, Zyn, Rogan.
But the back half is 100% suburban
mom: potential rain, the temperature,
grisly celebrity trials.
Cade, you contain multitudes.
Prediction markets are basically
platforms where you can wager
on the outcome of future events.
The companies decide
on the questions to list,
and right now, you can
wager on anything from,
"Will traffic in the Strait of Hormuz
return to normal by the end of April?"
to "Will the U.S. confirm that aliens
exist before 2027?"
These markets have seen exponential
growth in recent months,
logging billions of dollars
in bets every week.
You may have heard about them
on the news, or seen ads,
or stumbled across
influencers like this guy,
who is constantly updating
his followers
on how his various wagers about
the Trump administration are going.
And I'll warn you,
it's a real rollercoaster.
China question. Please!
High-end Nvidia chips to China.
But the Wall Street Journal
My hero!
The president has made his position
on this very clear, both to the Chinese,
that's not something we're interested
in selling to China at this time.
Yes! Yes!
Yes! Barack Hussein Obama!
I'm getting rich off Jeffrey Epstein.
The files dropped? Yeah!
Is Donald Trump named in
the files? They're all redacted?!
Yeah! A lot more screaming
than you thought, there, huh?
And it's kind of amazing to witness
someone absolutely furious
that Trump's name was redacted
from the Epstein files
for a completely different
reason than the rest of us.
The point is, a lot of people are
getting into prediction markets,
thanks in part to
an aggressive marketing push
by the two big players in this
space, Kalshi and Polymarket.
Kalshi recently locked in a
22 billion valuation from investors,
doubling its valuation
from just a few months earlier,
and Polymarket's currently
trying to do the same.
Meanwhile, dozens of new
entrants-like Coinbase, Robinhood
and even Truth Social, are also
trying to get in on the action.
It is shocking the extent to which
prediction markets have proliferated,
and sometimes
it's been a little unnerving,
given the things
that you can now bet on.
Ali Khamenei out as supreme
leader of Iran?
Will Nancy Guthrie's kidnapper
be arrested by the end of February?
Those are just two events offered
on popular prediction markets
in the U.S.
over the last couple of weeks,
where people could have put their
money down, betting on the outcome.
There's a lot of bad stuff
going on in the world,
and being able to bet on just
When somebody's gonna be found?
That's really dark to me.
Yeah, he's right. The impulse to try
and make money betting on war,
or an unfolding tragedy,
is really dark.
When someone dies, you're supposed
to send their family a card
that says, "Sorry for your loss",
and not one that says,
"Thanks for covering the spread!"
That's just one of many issues
associated with these sites,
and given that, tonight,
let's look at prediction markets
and try to answer a few questions
that you might have:
where exactly
did these sites come from,
what purpose, if any, do they serve,
and how on Earth is any of this legal?
And let's start with the fact
that the broad concept
of prediction markets on
news events is nothing new.
In the late '80s, economists
at the University of Iowa
created the Iowa Electronic Markets
as an experiment,
allowing students and faculty
to buy and sell predictions
about upcoming elections,
and interestingly,
they began to outperform
many leading polls.
The theory was that
"the wisdom of crowds",
in the form of people putting actual
money behind their opinions,
can produce useful forecasts.
And controversial uses of these
markets are not new, either.
After 9/11, the Pentagon actually
flirted with creating a market
where experts could wager
on future events,
hoping it could help predict
events in the Middle East.
But it quickly got shut down, once
members of Congress found out about it
and voiced their disgust.
This betting parlor on
the internet will include wagers,
for example, as the examples
on the internet site
put up by the Department of
Defense would include,
"Will Mr. Arafat be assassinated?"
"Will there be missile attacks
from North Korea?"
"Will the king of Jordan
be overthrown?" Just as an example.
I think this is unbelievably stupid.
That is a gentle thing to say about
a program that is so devoid of value.
It combines the worst of all of our
instincts, in my judgment.
Yeah, he was justifiably upset
at the notion of people betting
on geopolitical events
that would affect millions of lives.
As we all know, the only groups
that society's decided are allowed
to profit from instability
are military contractors,
members of the Trump family,
and the Mormon wives.
Whitney joined the cast of "Chicago" on
Broadway and Taylor gets announced
as the bachelorette,
and then notably unannounced?
I don't know how these women do it,
but I cannot stop watching.
The point is, back then,
the concept of betting on grim
outcomes seemed beyond the pale.
But everything started
changing a few years ago,
when Kalshi and Polymarket
launched as startups,
opening the door to the free-for-all
that we have now.
Initially, Kalshi sought regulatory
approval, and in 2020,
it was approved
as the first regulated exchange.
But Polymarket went a different way,
launching without approval,
and seeming to be comfortable
working outside the rules.
The government accused Polymarket
of operating an unlicensed exchange,
and as part of a 2022 settlement,
it agreed to pay 1.4 million
and block Americans
from trading on the platform,
while admitting no wrongdoing.
And it is worth watching
Polymarket's CEO, Shayne Coplan,
try and spin that penalty.
- It was a settlement.
And you could not have
customers in the United States.
Yeah, we had to go and geo-block
trading in the U.S.
and move certain operations
offshore.
And it wasn't, "Hey, you're banned
from trading in the U.S."
- It's like, "Until you're licensed."
- It was breaking the law.
People say "breaking the law."
It's like, "Which law," you know?
- So, if anything, it's incompatible.
- It's incompatible with the law.
Yeah, with the regulatory matrix
that existed.
Look, "incompatible with the law"
is clearly ridiculous,
but please don't overlook the line
"People say breaking the law,"
"and it's like,
'Which law,' you know?"
I'm sorry, what? I'm pretty confident
there is a specific law you broke,
given, you know, you paid
a 1.4 million penalty.
Regulators weren't just like,
"Shit, he just asked which law."
"The Chinese Exclusion Act
of 1882?"
From the start, Polymarket took
an extremely libertarian approach,
allowing users to use crypto to bet
anonymously on things like war.
And while it's currently rolling out
a new app to U.S. users
that does have government approval,
it is way more limited and
mostly offers trading on sports.
The vast majority of its business
is still done on Polymarket's
international version,
which is based offshore in Panama,
and on which American users
have to mask their location
if they want to trade.
And while doing that might be
a high technological bar to clear
for someone like me,
using a VPN is something anyone
under 25 learns to do
before they learn how to write
a cursive capital G,
mostly because that is an impossible
letter invented by someone
who wanted
to make children suffer.
It looks like someone stabbing himself
in the stomach with a pencil,
because that's exactly what trying to
write that letter makes you want to do.
But regardless of how these
companies got to this point,
both enjoyed a huge surge of attention
about a year and a half ago,
after this happened.
Kalshi made a name for itself
in the 2024 election.
Just over one week away
from Election Day,
and the race is neck and neck.
It looked close, unless you were
keeping an eye on Kalshi,
which called the race well before
the TV networks did.
It was like, Kalshi, then Fox,
then CNN.
- How did that feel?
- It was crazy.
Yeah, Kalshi predicted Trump would
win, as did Polymarket,
whose CEO then tweeted,
"Make no mistake,"
"Polymarket single-handedly called
the election before anything else."
"The global truth machine is here,
powered by the people."
And while it is not the most
important thing,
you have now met the CEOs
of these two companies,
and I'm just gonna say it:
they are two of the most
"extras in a Totino's Pizza Rolls
commercial"-looking motherfuckers.
Anyway, since then, they've both been
scrambling for market dominance,
which is why Kalshi, for instance,
has run TV ads like this.
Indiana gonna win, baby!
We're in Florida asking people
what they put their money on!
I'm all in on OKC!
Indiana got that dog in 'em!
- Will egg prices go up this month?
- I think we'll hit 20 dollars.
How many hurricanes do you
think we'll have this year?
Kalshi!
Kalshi!
Kalshi lets you legally trade on
anything, anywhere in the U.S.
OKC!
Indiana!
OKC! Kalshi!
Okay, that visual cacophony
is an AI slop atrocity.
It contained two alligators,
four shirtless or nearly shirtless
old guys, one egg freak,
three different people
being pursued by the police,
one woman I'm kind of rooting for,
one USDA inspector's
fucking nightmare,
and one alien seemingly rooting for
Duke, which, honestly, tracks.
And the whole thing ends with,
"The world's gone mad, trade it",
although given everything
that came before,
a more honest tagline might've been,
"Fuck empathy, get money. Kalshi."
And again, that is the one
that likes to present itself
as the more buttoned-down,
rule-abiding company of the two.
And at this point,
you might be thinking,
"Wait, isn't that
an ad for a gambling site?"
But both Kalshi and Polymarket
will fiercely argue
that that's not
what they are at all.
They argue that gambling involves
playing against "the house",
while their users are trading
against each other,
with the companies typically
just charging a fee on trades.
They'll also insist
that they're simply modern versions
of commodity futures markets, which
have been around for over a century.
If you're not familiar with them,
they're a place
where people can speculate
about the future price of things
like corn or natural gas.
Crucially, they will argue that the bets
they sell are financial instruments
that enable ordinary people
to hedge against future risks,
like betting that,
say, a hurricane will hit,
or that the U.S. government
will shut down.
Here's how Kalshi's CEO frames it.
We had a market
about whether student loans are going
to be forgiven or not this year.
And so, a lot of people were
hedging using that market.
And so, if it wasn't forgiven,
they would get paid some amount
of money that they could use
to basically pay the student loan.
And that's why this is very important.
Right. Apparently,
they're just trying to help people
make wise planning decisions.
It's the kind of responsible financial
thinking that you intuitively associate
with a company that advertises itself
with a shirtless old man being arrested
or an alien pledging Sigma Chi.
And look,
that might make some sense
when you're talking about
an economic indicator
or a specific event that might
impact you personally.
But what exactly is the financial loss
that I'm hedging against
if I bet on the next winner
of "The Masked Singer"
or on whether or not Mr. Beast
will say "Feastable"?
And when you watch some
of Kalshi's actual customers in action,
the notion that this is about sober
risk management feels absurd.
I tell you,
if I didn't win this election
and if you had a moron like Kamala
Yeah!
Number one, Sleepy Joe!
We're looking good so far.
Easy, bro. Okay. All right.
- We made about 200 bucks.
- Okay. All right.
Men playing in women's sports.
Wait!
We are off to a great start!
We hit
on that shit immediately!
"Sleepy Joe," "transgender."
We got "Sleepy Joe" and "transgender"
in like the first five minutes, bro.
- Bro, we're up like 500 bucks.
- We gotta make 1,000.
- Yeah, we gotta make 1,000.
- All right.
I couldn't even tell you what
this man is saying.
Like, he just says
a soup of random words.
Somehow Joel is just deciphering this
and just making money.
Yeah, that is not using a financial
instrument to hedge risk.
It's taking advantage
of a sundowning geriatric's
rapidly declining verbal abilities.
You bet he's gonna say
the word "nasty"? Great guess, dude,
it's one of the last 200 words
he has left.
Honestly, that clip is unsettling
on multiple fronts.
One, because
the president's harmful rhetoric
is being divorced from
its actual meaning, but two,
because that's not what these
bros are supposed to be doing.
They shouldn't be betting
on Trump speeches,
they should be sitting
on that same couch
and watching YouTube highlight reels
of Kevin Love outlet passes,
six Modelos in, forging a deep,
beautiful friendship
that will last 40 years and that
they will never, ever discuss.
Nature has lost its course.
The point is,
that sure looks like gambling.
And it is pretty telling that, while
political "mentions markets" like that
get a lot of attention,
around 90% of trading volume
on Kalshi is on sports.
But you can see why
these companies are so insistent
that they are not gambling sites.
Just 39 states, D.C., and Puerto Rico
have some form
of legalized sports betting,
with only 32 of those
allowing online gambling,
leaving some pretty attractive
mega-states like California and Texas,
on the table.
And by insisting
they are financial exchanges
offering not bets
but "event contracts",
prediction markets are not only
able to operate in states
where gambling isn't legal,
but also get around state taxes
and minimum age requirements
in states where it is.
And they've sometimes talked out of
both sides of their mouth on this.
Because in ads like this one,
Kalshi's called itself
"the first nationwide
legal sports betting platform."
But when asked about it, it later
tried to qualify that statement,
"that any financial position can be
considered a 'bet' on the future."
And that is so dumb,
it is almost charming.
It's like seeing a sign outside a strip
club that says, "Girls, girls, girls",
and then seeing the manager
come out and say, "We meant,
"Girls, girls, girls who code."
"We support women in STEM."
Sure you do, buddy. Nice try.
But these companies' insistence
that they are not gambling platforms
is one of the two most irritating
claims that they tend to make.
The other is that they're actually
incredibly important to society,
because they can help us
more accurately predict the future.
The head of Polymarket's
even called it,
"The most accurate thing
we have as mankind right now"
and has bragged that the predictions
it generates can save lives.
When I get hit up by people
in the Middle East who are saying
that, "We're looking at Polymarket"
"to decide whether we sleep
near the bomb shelter."
"Like, we look at it every day."
And I'm like,
"It's really that popular over there?"
They're like, "Are you kidding me?"
"Do you not know what's going on?
Everyone's relying on this."
That's very powerful.
That's an undeniable value proposition
that did not exist before.
Quick question: what
exact stage of capitalism are we in
when the child CEO of an offshore
gambling platform
refers to betting odds on bombings as
an "undeniable value proposition"?
Because it feels like we're in
palliative care at this point.
But I guess
that is the point you reach
when you're a 27-year-old billionaire
surrounded by yes men
who will never tell you the truth,
something I know for sure
because no one in his life told him
never to ever wear that jacket,
which, when he is sitting like that,
unmistakably says "peed rider".
Though for all the talk of these
sites' unparalleled accuracy,
you should know,
that's a bit of an oversell.
They have shown promise
in some areas,
a paper found Kalshi's predictions
were "roughly consistent"
with those of professional forecasters
when it came to the economy
and Federal Reserve policy.
But they've also
had some big misses.
For instance, both favored the Chiefs
to win last year's Super Bowl,
and also whiffed the recent
Texas Republican Senate primary,
with Polymarket even posting
a breaking alert that morning,
announcing Ken Paxton
was projected to win,
with their odds giving him
an 83% chance.
And, you know, he didn't do that.
And look, all of that would be fine,
these are just odds,
and real life can defy odds,
were it not for the fact
that these companies
are actively selling themselves
as basically oracles.
And they've even tried
to bolster that reputation
by entering paid partnership deals
with news organizations.
Dow Jones, parent company
of the Wall Street Journal,
announced a partnership with
Polymarket earlier this year,
while CNN, CNBC, and Fox News
all signed deals with Kalshi,
which even sponsors segments
on CNN that feature Kalshi's odds
on various future events scrolling
across the bottom of the screen.
And I do not want the CNN ticker
to have betting odds on news events.
I don't really want anything on there,
except maybe the odd distractingly
weird headline that takes my
mind off things for a second.
You know, something like,
"Giraffe escapes from zoo,
police say it has a gun."
You know,
something fun to Google later.
But having their logo
like that on CNN
is a big win for Kalshi.
Just as it's a big win for them to have
influencers like that guy from earlier
saying how easy it is
to win money.
Though you should know,
after we asked, Kalshi told us
that they paid him for that post.
And it feels like deals like those
should really be more transparent.
It makes me a little annoyed, and
to be honest, even more hungry.
And you know, when I need
something nutritious, yet in a can,
I know where to turn:
Bush's Baked Beans.
But full disclosure:
I was paid 40 dollars to say that.
The thing is, it's worth knowing
that, in reality, as with sportsbooks,
researchers have found that most users
of Kalshi and Polymarket lose money.
As we've discussed before,
casual gamblers
are always going to be easy prey
for more sophisticated operators with
advanced systems to give an edge.
Which is probably why,
while Polymarket has more
than two million users,
one analysis found more than
two-thirds of all money won on it
was held by just 740 accounts.
And if you're thinking,
"How exactly are these companies
getting away with all this?"
A lot has to do with who
is in the White House right now.
Both companies have fostered strong
connections with the Trump family,
in fact, Don Jr. is both an investor in
and an unpaid adviser to Polymarket,
and a paid adviser to Kalshi.
And look, I am not saying
that Don Jr. isn't providing
important or valuable insights,
although, in a much truer sense,
I very much am saying that.
I'm just saying, it's notable
just how hard it was for Kalshi's CEO
to answer a series of basic
questions about Don Jr.'s role.
Why did you guys make Donald Trump
Jr. a strategic advisor?
We have a lot of advisors,
and they span across the board,
across different functions.
But really, this is all about
growing this industry,
the prediction market industry,
that a lot of people really believe in.
What kind of advice
does he give you?
So, it really is, again,
about growing prediction markets.
He believes in prediction markets.
We believe in prediction markets.
A lot of people believe
in prediction markets,
and it's really about go-to-market
and expansion plans.
Does he come to meetings?
How much do you pay him?
What's his role? I mean,
this is the son of the president.
We, again, I mean,
we have a lot of advisors.
And whether it's our investors,
whether it's people
But he's not just any advisor. He has
a direct line to the White House.
We have a lot of advisors.
Yeah, turns out, it's pretty hard
to justify hiring a nepo baby,
or, in Don Jr.'s case,
"a nepo divorced dad".
But the thing is, if hiring Don Jr.
helped get these companies
on Trump's good side, it's a bet
that's paid off massively for them.
Because while the Biden administration
had at least tried
to rein in some of what
these markets were doing,
the Trump administration has
gone hard in the other direction.
And to understand the degree
to which that's the case,
take a look at the CFTC, or Commodity
Futures Trading Commission.
It regulates these platforms.
And it was actually empowered,
under the Dodd-Frank Act in 2010,
to block event contracts
about terrorism, assassination,
war and gaming.
You know, a bunch of what
you've seen so far tonight.
But it is clearly not doing that,
and it doesn't even seem to be trying.
In fact, while the CFTC's "supposed
to be comprised of 5 commissioners,"
"two of whom are required
to belong to the minority party,"
it currently only has this guy,
Michael Selig,
a Trump appointee who's a massive
cheerleader for this industry.
He completely buys into their whole
"this is about hedging risk" argument,
to the point that he once suggested
that somebody with a medical condition
could "manage the potential risk"
"of having a future treatment
or medical costs"
by placing a bet on the likelihood
of something passing a drug trial.
Which is, and I don't say this lightly,
one of the most fucked up suggestions
I have ever heard for this country's
Guernica-ass healthcare system.
And while Selig's recently made noises
about stronger enforcement,
it is hard to take him at his word,
given that,
during his confirmation hearings,
he told Congress
he'd let courts decide whether these
companies constitute gambling.
But in office, he's done the exact
opposite of that,
in fact, more than a dozen states are
currently suing prediction markets,
but rather than let that play out
in the courts like he promised,
Selig posted this video.
To those who seek to challenge
our authority in this space,
let me be clear,
we will see you in court.
What a fucking weasel.
That guy has both the energy
and fashion sense of a "Suits" villain
who goes toe-to-toe with Harvey
and Mike all season long
while Louis and Meghan Markle,
I don't care what you say, that's
her character name to me, watch on.
But he's done more
than just threaten.
Selig's led his agency to sue
three states
to get them to back off trying
to regulate prediction markets.
So right now, these companies
are able to operate
under extremely
friendly conditions.
And given that, it's worth looking
at some of the problems
that have already begun to emerge,
starting with the fact that,
for a lot of these bets,
it is incredibly easy
for individuals to manipulate
the outcomes.
Some have even joked about that.
For instance,
on a recent earnings call,
the CEO of Coinbase said this.
I was a little distracted because
I was tracking the prediction market
about what Coinbase will say
on their next earnings call,
and I just want to add here
the words Bitcoin, Ethereum,
blockchain, staking and Web3,
to make sure we get those in
before the end of the call.
Yeah, he saw people's bets online
and just rattled off words
that they'd bet on him saying.
And it really feels like manipulating
betting outcomes
should be more difficult
than that.
In the old days, you at least had
to sneak cocaine to a racehorse,
not just rattle off a list
of the most punchable words
in the English language.
We even realized, while
researching this piece,
that there was betting
happening around this show,
specifically, on what words I'd say
during our show on February 22nd.
Which is stupid for multiple reasons,
including that we tape on Saturday,
in front of a studio audience,
all of whom would then have
a massive information advantage
and more than 24 hours before
the betting window closed.
Now, thankfully, we wipe every
audience member's memory
before we let them out of the taping.
We try to erase
only the last couple of hours,
but sometimes we do wipe clean
a milestone birthday.
That's on us, and we're constantly
calibrating the technology.
You've been warned. You won't
remember, but you've been warned.
There are markets where it is too easy
for anyone to manipulate outcomes.
Just last summer, you might remember,
a bunch of assholes
started throwing dildos on the court
during WNBA games
to promote a crypto meme coin.
And if that wasn't already
a cursed enough sentence,
I'll let this South African man fill
you in on what happened next.
Did you know that you can actually
bet on whether a dildo
will be thrown at the WNBA game
on August 9th,
August 11th, that's today,
and August 12th?
Right here on Polymarket.
I had no idea.
Actually, I had no idea what
the WNBA was either,
until you could place a bet on whether
a dildo would be thrown at it.
Yeah, none of that is great.
And it is pretty depressing
that the way he learned
about the existence of the WNBA
was finding out you could bet
on whether a dildo would be
thrown at one of its games.
It'd be like finding out about
the existence of Robert De Niro
by Googling
"the cast of 'Dirty Grandpa'."
No, don't. Not like this.
Don't learn about him like this.
But it is true. People started betting
whether dildos would be thrown again
and Polymarket even put up
this tweet promoting the bets.
And sure enough,
more dildos got thrown.
And that could well have been
because Polymarket had just created
a situation where
you could easily make money
by betting someone
would throw a dildo,
and then going to a game
with a dildo and throwing it.
There've also been multiple instances
of people seeming to use
inside information
to game these markets.
Last year, a trader made
over a million dollars
with a series of accurate bets
about Google's rankings
of its most searched people of 2025.
That same person, by the way,
had also earned over 150,000
by predicting the exact release
date of Google's Gemini 3 model.
Which really makes you think
that that person
either worked for Google,
or knew someone who did,
or maybe managed
to hack Google from the outside,
in which case, would it kill you to do
a Google doodle for my birthday?
It is on Thursday, by the way.
And Polymarket's CEO has,
in the past, openly celebrated
the fact that this kind of thing
can happen on his platform,
because he's argued it just makes
its prediction abilities much stronger.
What do you guys do, if anything,
to guard against insider trading?
Yeah. So, it goes back to this
idea of information markets, right?
Like, you think about,
"When will Gemini 3 launch?"
Nobody is under the impression
that nobody knows the answer, right?
Like, of course,
there's people who are working on it
who know when it's gonna come.
And I think what's cool
about Polymarket
is that it creates this financial
incentive for people to go
and divulge the information
to the market,
and the market to change, and all
When you say divulge, you mean
the people who actually know?
Yeah, or someone tells someone
and then the market responds.
Yeah, he basically just answered
the question,
"How do you guard against insider
trading?" there with "No".
And he did it with a fashion choice
even worse than his biker jacket,
because what in the NYU army
fatigues is that shit?
That sweater looks like it was made
from illegally poached Grimace.
But also, I don't care how many
statement sweaters you wear
or how many "Ben Platt in 'Dear Evan
Hansen'" haircuts you have,
you're not describing some edgy
chill way to divulge information.
You're describing insider trading.
And it gets genuinely chilling
when you realize that people seem
to be using insider info
to bet on life-or-death events.
In January, after the U.S.
seized Nicolas Maduro,
an anonymous trader pocketed more
than 400,000 dollars
off bets that that would happen,
with the bulk of those bets made
mere hours before
the raid was announced.
In February,
two Israelis were charged with
using classified military information
to place bets on Polymarket.
And in March, this happened.
Deadly American strikes,
and some people may have
made money from them.
More than a dozen anonymous
accounts placed bets
predicting that the US would strike
Iran by Saturday the 28th of February.
Most of those wagers were placed in
the hours before the first bombs fell.
And many of the accounts had
been created only days earlier.
One of the biggest winners used
the account name "Magamyman".
The trader placed 87,000 dollars
on a war with Iran
exactly 71 minutes before
the first strike,
winning a jackpot
worth 515,000 dollars.
Yeah, that sure feels
like someone with inside information
was betting on Polymarket.
And I'd say that it wasn't a great idea
to make their username "Magamyman",
except it doesn't seem
to matter anymore, does it?
His username
might as well have been
"Magamyman, just kidding,
my name is Dylan Barthwell"
"and I work at the Department of
Defense." He's not really risking much.
Now, I should say,
Kalshi just announced
it took action
in two insider trading cases,
and has taken out billboards
bragging that it bans insider trading
and also that it doesn't offer
death markets.
Which is a little weird.
It'd be like McDonald's putting up ads
that its nuggets
"don't contain baby meat".
Okay, mama, but now I have
way more questions.
For its part, Polymarket recently
updated its rules to clarify
that users can't act on stolen
confidential information,
wager using illegal tips,
or bet if they're in a position to
influence the outcome of an event.
Although it is not a great sign
that just recently,
there was a suspicious spike
in trading
right before the ceasefire
with Iran was announced,
as "a group of new accounts on
Polymarket made highly specific,"
"well-timed bets" about it, earning
hundreds of thousands of dollars.
So, it sure seems like right now,
we've effectively got gambling sites
operating even in states
where gambling is illegal,
and offering bets on things
that there've been laws against
for over a decade now.
So, what can we do?
Well, at the bare minimum,
the CFTC should be doing more,
and while it says it's writing new
rules, I wouldn't expect much,
especially for as long as this
fucking guy's in charge.
As I said earlier,
there are a bunch of cases
making their way through
the courts right now,
but it's not clear how they'll resolve
and it's probably going to be
in front of the Supreme Court.
Meanwhile, Congress is considering
a number of proposals
tackling aspects of this issue,
although,
given that the president of
the United States has a kid
advising both major companies,
I wouldn't hold your breath.
So, meaningful policy shifts
in the near term do seem unlikely.
But at some point, we do need to put
in place some basic guardrails here.
And until then, if we can't change
how these sites operate,
we should at least try and change
how we individually see them.
One thing that would frankly help
is if news organizations
stopped laundering these companies'
reputations for them
by putting their odds on screen
like they are actual news.
Because is it a bad idea for them
to be doing that?
If I may quote the single loudest
Yes!
Yes. Exactly. I couldn't
have screamed it better myself.
And look, on a personal level,
if you're considering
using these markets to gamble,
try and remember that you are
statistically likely to lose money.
And while
I am not against gambling per se,
there is something so grim
about these sites
turning every aspect
of our lives into a bet.
Because, sure, money
can be won on them,
but in that happening,
something also gets lost.
Specifically, a society where things
aren't only weighed in financial terms
and where people engage with news
for what it means to human beings,
not just because they have
50 dollars riding on it.
And when something unexpected
happens in the world,
it would be really nice
not to have to automatically question
whether it's only because someone
is trying to move a market.
That is why I'm going
to make you a promise tonight:
I will never do anything because
someone online placed a bet on it.
So, you can be confident
that if I ever say
"Bitcoin, Ethereum, blockchain,
staking, and Web3",
it won't be because
I'm trying to move markets,
it'll be because
I'm having a stroke.
And once you have that trust,
you can feel secure in the knowledge
that if a dildo ever
lands on this desk,
it's not because someone had
a secret wager on it.
It's because we weren't sure how
to get out of a 32-minute segment
on a quasi-legal gambling industry,
but we knew that a thrown dildo,
in the right circumstances,
and with the full consent of the person
having it thrown at them,
would be undeniably funny.
And if more than one dildo lands,
it'll only be because
a fundamental rule of comedy is
"more dildos is more funny".
And if it turns out there are too
many dildos flying through the air,
I promise, it will only be because
we didn't know how many to buy,
and now we're sort of screwed,
because I don't think
you're allowed to return them.
That is our show,
thank you so much for watching,
see you next week, good night!
This is just too many dildos!