Election betting in the US has seen a sharp rise after a court ruling lifted restrictions on the practice, allowing platforms to accept substantial stakes on the presidential race between Republican candidate Donald Trump and his Democratic rival, Vice President Kamala Harris.
This surge follows a legal victory by trading platform Kalshi, which successfully challenged a US regulator’s opposition in court last week.
The company, which is now cleared to operate, allows investors to bet up to $100 million on the outcome of the November election. The platform is currently forecasting a tight race, with trends indicating a slight lead for Trump over Harris.
The legal battle came to a head when the Commodity Futures Trading Commission (CFTC) attempted to block Kalshi, arguing that election betting could harm democratic integrity by resembling gambling. However, a Washington court ruled in favor of the platform, citing insufficient evidence of potential harm. The CFTC’s appeal of the decision is ongoing.
Since the ruling, Kalshi has reported over $12 million in bets, with founder Tarek Mansour noting efforts to attract more traders, including institutional investors. “We’ve seen strong early interest, but we expect volumes to climb as election day approaches,” Mansour said.
Stakes are placed through binary options, which are priced up to $1 per contract. As of Monday, contracts favoring Trump traded at 54 cents, while those for Harris were priced at 47 cents. This narrow gap has fluctuated since the market opened, but analysts caution against over-interpreting these figures.
“While these numbers suggest traders are leaning towards a Trump victory, the true picture will become clearer with more institutional money in play,” Grant Ferguson, a political scientist at Texas Christian University, said.
Offshore platforms, such as Polymarket, have also seen a sharp increase in election-related betting, with more than $1.9 billion currently staked. Experts predict this figure could rise tenfold as Election Day nears.
Despite the enthusiasm, concerns remain over the impact of election betting on voter perceptions and the democratic process, issues that are expected to persist as legal appeals unfold.