A CNN analysis suggests users under 18 may be responsible for billions in trading volume on Kalshi, raising new questions about age restrictions, regulatory oversight, and the potential risks for young participants in prediction markets
Recent reporting from CNN has brought new attention to the role of under-18 users in the U.S. prediction market sector, specifically on the Kalshi platform. While prediction market operators have previously downplayed the significance of younger users, new data suggests that their trading activity may be far more substantial than previously acknowledged, especially in areas that overlap with regulated gambling products.
Trading Volume and Age Restrictions
According to CNN, trades by users under 18 on Kalshi have generated an estimated $5.4 billion in total trading volume, with $3.9 billion of that figure tied to sports event contracts. This is notable because, in most U.S. jurisdictions, sports betting is strictly regulated and typically limited to individuals 21 and older. The reported figures highlight a regulatory gray area, as prediction markets like Kalshi argue that their event contracts are distinct from traditional gambling, even as their products increasingly resemble sportsbook offerings.
Product Expansion and Regulatory Tension
Kalshi has recently expanded its product lineup to include trading options that closely mirror parlay bets, allowing users to combine multiple outcomes into a single contract for potentially higher payouts. This move has drawn scrutiny from responsible gambling advocates, who argue that such features may increase the risk of addictive behavior, particularly among younger users. Les Bernal, national director of Stop Predatory Gambling, told Fortune that the gamified experience of prediction markets can be especially appealing—and potentially harmful—to minors. The debate over how to regulate these platforms is intensifying as their popularity grows.
Industry Response and Alternative Approaches
Not all operators are taking the same approach as Kalshi. Fanatics, which recently launched its own prediction market platform, has opted to restrict access to users 21 and older for sports-related contracts, aligning its policy with most state-level sports betting regulations. The broader industry is watching closely as regulators, operators, and advocacy groups debate the appropriate balance between innovation and consumer protection. The Responsible Online Gaming Association has also weighed in on related issues, introducing voluntary advertising standards to address concerns about marketing to vulnerable groups, as discussed in a recent AZAR NEWS report on responsible gaming advertising standards.
Uncertainty Around Impact and Future Oversight
Despite the growing attention, much remains unknown about the long-term impact of prediction markets on young users. Academic research, including a recent paper in Science, has raised concerns that the continuous stream of new event contracts and the lack of natural stopping points may contribute to problematic trading behaviors. As the sector evolves, regulators and operators face increasing pressure to clarify age restrictions, product definitions, and consumer protections to address emerging risks.
Understanding the distinction between betting handle and revenue is essential in this context. 'Handle' refers to the total amount of money wagered or traded on a platform, not the operator's profit or revenue. In prediction markets, high handle figures can signal significant user engagement but do not necessarily indicate profitability for the platform. Regulatory scrutiny often focuses on handle when assessing market size, risk exposure, and the potential for consumer harm, especially when minors are involved.
