Google announced earlier this month that it will integrate odds from online betting platforms Kalshi Inc. and Polymarket into its Google Finance tools amid pushback from lawmakers over the evolution of modern-day gambling.
Integrating "Event Contracts" Into Financial Platforms
The integration of these “event contract” sites will enable users to “ask questions about future market events and harness the wisdom of the crowds," according to a company blog post. The decision, however, comes as both Kalshi and Polymarket navigate a complex web of state and federal regulations.
Regulatory Debate Over Event Contracts
Kalshi and Polymarket maintain their platforms offer “event contracts” between private parties that should be regulated like commodities rather than traditional gambling subject to state oversight; an argument that has received pushback from government officials, NBC Chicago said. Companies like Kalshi and Polymarket should “package sports betting as events contracts” to circumvent established gaming regulations, state attorneys general claimed in a lawsuit in June.
U.S. senators including five Democrats and one Republican addressed that concern in a letter to Commodity Futures Trading Commission Acting Chair Caroline Pham September “By claiming to be federally regulated … issuers of sports event contracts can avoid myriad state \[gaming\] laws, including licensing and background investigations, minimum age requirements, federal anti-money laundering rules, and consumer protections such as addiction warnings and integrity monitoring,” the lawmakers wrote.
Voters Favor Federal Oversight
Nearly 80% of American voters support keeping prediction market regulation at the federal level rather than under state gambling authorities, according to a poll of 1,219 people nationwide commissioned by Kalshi and conducted by Axis Research. Eighty-nine percent of respondents agreed all Americans should have the freedom and ability to choose whether or not to engage in these markets regardless of their own participation.
Among those surveyed, 75% of Republicans and 71% of Democrats supported a federal regulatory approach to prediction markets. "American voters want the freedom to choose how to invest their own money without state-level interference," Kalshi Head of Corporate Development Sara Slane said in a LinkedIn post. "The current federal regulatory structure is best equipped to oversee this financial activity, a point underscored by Congress."
Prediction markets currently fall under the jurisdiction of the Commodities Futures Trading Commission, which oversees event-based contracts that allow participants to trade on the likelihood of future outcomes.
Controversies Over Outcome Determinations
Polymarket and Kalshi have faced criticism over controversies regarding event outcome determinations. For instance, Polymarket’s bet on whether Ukraine’s President Zelenskyy would appear in public wearing a suit before July sparked disputes about what qualifies as “a suit,” Event Horizon reported.
Meanwhile, Kalshi users expressed frustration after the company refused to pay out bets when former X CEO Linda Yaccarino announced she was leaving the company, reported Event Horizon.
Trump Administration's Role in Shaping the Industry
The Trump administration has become a key player in Kalshi and Polymarket’s market dynamics. Donald Trump Jr., the president's eldest son, serves as a formal adviser to both companies. The CFTC in May dropped a case against Kalshi initiated by Biden-era regulators, clearing the way for Polymarket to regain U.S. market access as indicated by the CFTC in September. In October, Trump's social media platform Truth Social announced plans to launch Truth Predict, a crypto-based event betting service.