The Odds Are In: Prediction Markets Gear Up for the November 3 Midterms

Combined monthly trading volume on Kalshi and Polymarket more than doubled from $26 billion in May to $53 billion in July, according to a Pew Research Center analysis, as the platforms approach the November 3 U.S. midterm vote far larger than in 2024. Most of that activity was on sports. Politics remains a smaller slice, averaging about $2 billion a month on Polymarket this year and under $300 million on Kalshi, while more than $30 million had been traded by July on which party would win the House and the Senate, CNBC reported.

In 2024, election contracts became legal in the U.S. only a month before the presidential vote. This time, Kalshi's head of politics growth Benjamin Freeman told CNBC, "there's a much longer runway to plan."

The Commodity Futures Trading Commission once barred Kalshi from listing contracts on which party would control Congress, finding they involved "gaming," and in 2024 proposed a rule that would have classed election contracts as gaming. It withdrew that proposal in February. On June 10, it published a proposed "structured framework" for event contracts under which elections would not count as gaming, according to a Congressional Research Service analysis. The proposal also argues that by "harnessing the wisdom of the crowds," event contracts can produce information more reliable than other forecasting methods, CRS noted.

Kalshi's Midterms Hub, launched that month, puts traders' odds for individual races alongside polling averages. Chuck Todd, the former NBC News political director and Meet the Press moderator, is the official host of NEXTPredict, which runs on October 22 and 23 at Convene, Hudson Yards in New York. Organizers booked CNBC correspondent Contessa Brewer and CNN senior reporter Marshall Cohen around the midterms, putting working reporters on the program beside the exchanges; both were added in August. Organizers expect more than 50 speakers and 2,500 attendees. Prediction markets have moved into the mainstream media, with odds now regularly quoted on cable news, in wire copy and in equity research notes, which is why NEXTPredict has put working reporters on the program rather than in a press room behind it.

In a September 18 interview, NEXTPredict co-founder Pierre Lindh asked Todd what he wanted to learn at the event, and he framed it as "the pollsters versus the prediction markets." "How much do they need each other? How much do they feed each other?" Todd said. He also wants to determine how much trading is hedging and how much is entertainment. "I'm open minded on this. Is this going to be healthy for politics that it's subject to markets like this, or is it going to create a different class of politician?" On some races, Todd said, he has come around. Of the Texas Senate race, where Democrat James Talarico faces Republican Ken Paxton, he said, "I'm with the prediction markets here."