DraftKings ‘Looking At’ Election Betting After 2024 Race Spurs Record Interest
DraftKings plans to investigate nonsport betting prediction markets, particularly regarding election betting, following the 2024 presidential race which attracted remarkable media coverage and political analysts frequently cited the odds leading up to November 5.
Shortly after voters chose Donald Trump for a second term, interest in political betting exchanges surged, and during DraftKings' third-quarter earnings call, CEO Jason Robins disclosed that the sportsbook company is exploring these wagering markets. The co-founder of DraftKings stated that opportunities in election and non-sports betting are "quite intriguing."
"I do think there could be a place for [prediction markets] outside of elections, but that’s really where the interest seems to be now from customer demand side. It’s definitely something we’re looking at in advance of the next presidential election and potentially there will be an opportunity to look at something sooner,” Robins said.
Robins, however, stated that this type of gambling operates under a significantly different regulatory framework compared to sports betting.
“It’s not licensed as a betting product. It’s licensed as a financial market,” Robins continued. “It’s a very different thing. So, we’ll have to see where it fits in, but we’ll plan on looking at it ahead of the next election, that’s for sure.”
Betting Records
Over $3.65 billion was bet on the outcome of the 2024 presidential election on the betting platforms Polymarket and Kalshi.
The majority of the activity occurred on Polymarket, the offshore, cryptocurrency-driven peer-to-peer betting platform that prohibits wagers from individuals within the United States due to a 2022 agreement it reached with the US Commodity Futures Trading Commission (CFTC). Polymarket's 2024 US presidential prediction market drew unprecedented attention from gamblers beyond the US, with the competition generating over $3.2 billion in wagers.
The funds were placed on Donald Trump, the current president-elect. The ex-casino owner's suggested odds on Polymarket when the initial polls ended were at 61%. Vice President Kamala Harris had a probability of 39%.
There was a bit more excitement for Harris on Kalshi, where her odds as the initial polls ended were at 42% compared to Trump’s 58%. Kalshi, on the other hand, saw significantly less activity regarding the election result — roughly $450 million.
Kalshi delayed entering the race due to an extended legal dispute. Kalshi's Trump-Harris matchup was launched in early October following a federal appellate court's decision that the CFTC exceeded its authority by directing Kalshi not to provide prediction betting markets related to elections in the US.
Gamblers Outpace Pollsters
Ahead of the 2024 presidential election, pollsters believed the result would be uncertain. Many of the critical swing states fell within the margin of error, seemingly indicating that Harris had an equal opportunity of becoming the 47th president as Trump.
The betting markets suggested Trump had a considerably higher likelihood of achieving 270 Electoral College votes. They were correct.
“Traders didn’t buy the Harris hype and were very bullish on Trump in the Sun Belt. From their inception, our Georgia, North Carolina, and Arizona markets all showed Trump to be the clear favorite despite talk of an upset,” wrote Kalshi Lead Market Editor Terry Oldreal. “Despite weeks of accusations and speculations, our markets emerged victorious, and our haters are now our waiters at the banquet of success.”