Prediction Markets Let You Bet on Just About Anything — But There Are Risks

Learn how prediction markets work, the legal gray areas in which they operate, and how they could be regulated in the future.

What are prediction markets like PredictIt, Polymarket and Kalshi, and how do they work? Is it legal to bet on elections in the United States? Hosts Tess Vigeland and Anna Helhoski welcome Sam Taube, the writer of the Nerdy Investor email newsletter, to break down how event contracts operate, explore the legal gray areas of election betting, and discuss whether prediction markets are a smart financial move—or just gambling in disguise. Then, Tess and Anna break down this week’s money headlines, including the latest inflation figures and what they mean for interest rates, the CFPB’s plan to enforce new click-to-cancel subscription rules, and Spirit Airlines’ Chapter 11 bankruptcy filing.

In this episode, the Nerds discuss: how prediction markets work, betting on elections, event contracts explained, investing vs gambling, election betting legality, gambling vs investing, Commodity Futures Trading Commission, event contracts legality, prediction market regulation, prediction markets news, event contracts explained simply, and Consumer Price Index.

To send the Nerds your money questions, call or text the Nerd hotline at 901-730-6373 or email podcast@nerdwallet.com.

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