Poker to prediction markets
Daniel Negreanu was already the top spokesperson for the world’s largest online poker room, GGPoker, and now he is repping one of the major players in prediction markets, Kalshi. On Tuesday, the Poker Hall of Famer tweeted that along with his new partnership with the site, he is giving one person who signs up at Kalshi with his promo code a $30,000 stake in the WSOP Paradise Super Main Event.
In the brief video, Negreanu hyped Kalshi as a site where you can trade on anything, though it is most popular with sports and political markets.
In an interview with PokerNews, Negreanu elaborated: “It’s so fun. I play Kalshi markets, where it’s not about me making a bunch of money. I’m betting $100, $250, but I sweat the markets every day.”
“I got one that’s so silly,” he added. “I bet ‘Will Trump ban lab-grown meat by the end of the year?’ I bet no, but I had to lay a big price, right? It’s just a lot of fun.”
Negreanu notes in his announcement that Kalshi is not a sportsbook, but it is also telling that he used the term “bet” in the above quote. It is certainly true that Kalshi is not a sportsbook, but playing the markets on the site is effectively just another form of betting.
Wheel and deal
Instead of wagering using betting lines set by the site, bets are made in a stock-market-esque manner, hence prediction “markets.” The site lists prices from $0.01 to $0.99 on the different outcomes – for instance, one price on “Yes” for the lab-grown meat market and another price for “No.” Users buy shares in outcomes, depending on what they think will happen.
These prices will fluctuate not because someone at Kalshi makes changes, but rather based on the buying and selling activity of the shares. If more and more people think the “Yes” outcome will happen, then its price will increase. Once an outcome is officially determined, everyone who owns shares in the winning result receives $1 per share. Losing shares get nothing and are worthless.
Kalshi does offer a few key advantages over sportsbooks. First, because the markets are fluid and shares can be bought and sold, you can move in and out of your bets at will. Thus, you can profit (or mitigate loss) by selling before an outcome is determined. Second, Kalshi doesn’t charge a fee to bet, so it is theoretically cheaper than a sportsbook (though one study would dispute this at the moment). And third, because it is a trading market and not a sportsbook, it is legal in all 50 states.
A downside of Kalshi is that while it does have a “responsible risk management” section on its site and has some mechanisms in place to allow users to limit their betting, it does not readily advertise any of this. And since it’s not technically sports betting, it is not regulated as such.
Image credit: PokerGO.com
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