Midterm election betting hits record $1.4B as prediction platforms go mainstream

People across the United States are betting on this year's midterm races at record levels for US election betting.More than $1.4 billion has been wagered on the midterms, according to the platforms and industry research. Prediction market platforms allow traders to buy and sell "yes" or "no" contracts on a range of race outcomes and variables. The markets rose to prominence in 2024 when they bucked traditional opinion polls in signaling that Donald Trump would win the presidency.Among those watching the results roll in on Tuesday evening will be Noah Poser, who will be glued to his phone tracking dozens of large wagers he placed on prediction markets when polls close in the US midterm elections on Tuesday night. Poser, 28, works in financial technology and has written about betting strategies in such markets.A screen displays a Kalshi advertisement on political betting featuring Senate control in New York City (Reuters)He plans to track every change in the vote count from a friend's watch party in New York City. He said he has wagers totaling six figures on the line, betting on a strong showing by Democrats. He placed the bets a few months ago when the odds were much better.If he wins, he estimates profits of as much as $30,000."It's a numbers game; you have to strip your emotions out of it," said Poser, the author of a self-published book about his prediction markets strategies. Poser built a quantitative model for trading these markets based on a career in Wall Street technology systems. He will not be alone on Tuesday evening.Election betting offers high profits and huge emotional swingsA 22-year-old Florida State University student, Yadin Eldar, is among those with money riding on the outcome. Eldar expects the Democrats to win on a large scale, but his approach runs the other way: he is betting on races where his analysis shows the odds of Republican candidates emerging victorious are "extremely underpriced." "You can make a 50-55% profit on Republicans winning in Florida," he said in an interview. Eldar said the experience is stressful. He may leave his own phone at home on Tuesday night when he heads to an unrelated birthday party. "The emotional roller coaster is extremely dangerous," he said. Voters are expected to hand the Trump administration a bloody nose in the midterm elections (AFP/Getty)"It never does me any good. I panic sell or panic buy." Another hopeful with money on the line is Darius Gamble, 51, of Gardendale, Alabama. Gamble, a human resources business partner, said he has been betting on the platforms for two or three months. He won't wager more than $20 on anything. "It is gambling, just disguised as predictions," said Gamble. "It gives you a gambling rush."Packed summits and Wall Street sponsors propelled election betting into mainstreamPrediction markets' surging popularity is being embraced by big-ticket industry events. One sign of that came in October, when a gathering called NEXTPredict drew a capacity crowd of more than 2,000 traders, investors and platform operators to New York. Several of its sessions were given over to election contracts. "It's a very different vibe than we had in 2024, when prediction markets were really new and kind of upstarts," said Lucas Kohorst, co-founder of Adjacent Markets, a platform that raised $2.5 million this summer to build out its business aggregating contracts into tradable indexes or benchmarks. Adjacent's own political indexes have been moving in recent days. Prediction markets' surging popularity is being embraced by big-ticket industry events (Reuters)The firm's Democrat Political Futures Index has climbed 2.38% over the past seven days, while its Republican counterpart has edged up 0.14%. Kohorst made his own plans for election eve. Late last week, he and his team flew from New York to Chicago to attend a watch party hosted by Kalshi, a top prediction market. Kalshi had joined financial market stalwarts like the Options Clearing Corporation as a silver-level sponsor of the Futures Industry Association's annual conference. "This time, prediction markets seem to have joined the mainstream," Kohorst said. Kalshi did not respond to requests for comment on the event.A Vegas bar is betting on election night to lure gamblers from StripA bar owner in Las Vegas is betting that America's midterm elections can pull gamblers away from the slot machines and roulette tables of the Strip. Peter Klamka recently launched his Prediction Vegas bar, and he believes the midterms could turn it into a popular new draw. The city is the spiritual home of a casino industry that takes a strong line against prediction market platforms, yet aficionados of those markets are seizing on the midterms all the same. Klamka is also preparing to host the Prediction Markets Conference, an industry gathering, on Tuesday evening. The state of Nevada has placed serious restrictions on prediction markets (Reuters)"No casinos will be showing elections," Klamka said. "From a Vegas standpoint, I'm it." Nevada has placed severe restrictions on prediction market offerings. Klamka says many of his clientele come from out of state and make their trades before they arrive. Ish Milly, the organizer of the Vegas prediction markets conference, sees the election party as only one small part of the story. "Ultimately, we're more interested in the long-term development and credibility of the industry than the outcome of any single election," he said.