Key Takeaways
- 79% of surveyed prediction-market users reported losing money in the past year, including 27% who lost more than $500.
- 51% used credit cards, loans, or other borrowed funds to place bets, with the loss rate rising to 88% among borrowers.
- Financial motives drove participation, with 53% joining to earn extra income or address financial difficulties.
Nearly four in five prediction-market users lost money over the past year, while more than half borrowed funds to place bets, according to a new survey of US adults.
The BadCredit.org study found that 79% of users reported losses and 51% had funded positions using credit cards, personal loans, or other borrowed money.
The findings raise consumer-protection concerns as prediction-market activity reaches record levels and more Americans treat these platforms as potential income sources.
Loss Rate Climbs to 88% Among Borrowers
BadCredit.org surveyed 1,000 US adults, 15% of whom said they had used platforms such as Kalshi, Polymarket, or PredictIt.
Among those users, 79% reported losing money during the previous year. More than one-quarter, or 27%, said they lost over $500, including 9% whose losses exceeded $1,000. Only 21% reported no losses.
Results were worse among users who borrowed to participate. Of the 51% who used credit cards, personal loans, or other forms of debt, 88% lost money. That compared with a 69% loss rate among users who did not borrow.
Consumer finance expert Erica Sandberg warned that financing bets with debt can increase the total cost of a failed position, as borrowers may continue paying interest even after losing their original stake.
“Although tempting, borrowing money, whether with a credit card or taking out a loan to place a bet, is a universally bad idea,” Sandberg said.
The results are based on self-reported responses rather than verified account histories. The survey did not calculate users’ net returns from platform-level transaction records.
Users Increasingly View Markets as Income Sources
Financial need was the most common reason respondents gave for joining prediction markets.
The survey found that 44% wanted to earn extra income, while 9% were financially struggling and needed an additional source of income.
Together, 53% cited income-related motivations—nearly twice the 27% who joined for entertainment or curiosity.
Social media influenced 10% of users, while 7% joined following recommendations from friends or relatives. Another 3% said conventional investing felt inaccessible.
Across the full sample, 30% believed prediction markets could realistically improve their finances. Men were more likely to hold that view than women (37% vs. 25%) and were also more likely to have used a platform.
The findings suggest that some consumers may regard event contracts as a financial lifeline rather than speculative entertainment. Prediction markets allow participants to trade contracts tied to outcomes, including elections, sports, economic data, and cryptocurrency prices.
Record Trading Growth Draws Regulatory Attention
The reported losses come as prediction-market trading reaches unprecedented levels.
Kalshi, Polymarket, and Polymarket US generated a combined $50.59 billion in trading volume during July, up 7.8% from June.
Kalshi accounted for approximately $37.7 billion of the total, while Polymarket’s US and international operations generated a combined $12.9 billion.
Those figures measure notional trading activity rather than customer deposits or losses. Because contracts can change hands repeatedly before settlement, the same capital may contribute to volume multiple times.
Rapid growth has intensified debate over whether some event contracts, particularly those linked to sports, function more like regulated derivatives or conventional gambling products.
The Commodity Futures Trading Commission (CFTC) oversees federally registered platforms, but several states maintain that certain contracts require local gaming licenses.
Federal lawmakers and regulators are also examining customer protection, advertising, and market integrity.
BadCredit.org used raw, unweighted responses for its online survey. It estimated a margin of error of approximately 3.1% for the full sample and around eight percentage points for the smaller prediction-market user group.
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The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Giuseppe Ciccomascolo began his career as an investigative journalist in Italy, where he contributed to both local and national newspapers, focusing on various financial sectors.
Upon relocating to London, he worked as an analyst for Fitch's CapitalStructure and later as a Senior Reporter for Alliance News. In 2017, Giuseppe transitioned to covering cryptocurrency-related news, producing documentaries and articles on Bitcoin and other emerging digital currencies. He also played a pivotal role in establishing the academy for a cryptocurrency exchange website. Crypto remained his primary area of interest throughout his tenure as a writer for ThirdFloor.
