Regulators to Shutter PredictIt’s Elections Gambling Platform

Image Credit: iStock, Pinkypills

Sign up for smart news, insights, and analysis on the biggest financial stories of the day.

When it comes to politics, all bets are off.

Since 2014, online predictions marketplace PredictIt has allowed Americans to vote with their wallets and gamble on elections, but the Australian-based site has been ordered to shutter its US-based operations by February.

The Two-Parlay System

Gambling on election outcomes has always been a legal gray zone. It’s neither federally banned nor locally approved. Vegas casinos won’t take your Washington wagers, nor will popular sports betting apps like FanDuel or DraftKings (though off-shore European bookkeepers happily accepted a record $1 billion in bets on the 2020 election).

But PredictIt and similar sites somehow circumvented legal restrictions by purporting to be a public good:

  • When the site first launched eight years ago, the Commodity Futures Trading Commission (CTFC) granted it a no-action relief letter, because the site was run by the New Zealand-based Victoria University of Wellington, which supplied gambling odds and results to academic researchers. PredictIt odds soon became widely cited in mainstream horse race media.
  • Last week, the CTFC ruled to reverse its previous issuance of allowance, saying the site was no longer “a small-scale, not-for-profit, online market for event contracts in the U.S. for educational purposes.” PredictIt, which caps bets at $850, refuted the claim.

Politico Pikers: A deadline to cease operations has been set for February 15, though the vice provost at Victoria University of Wellington says it has yet to decide how to pay out contracts that conclude after the site closes. So if you must play your Dwayne “The Rock” Johnson 2024 hunch, you’ll have to talk to your local bookie.