To Las Vegas, Nevada,
Betting on the result of an election with family, friends or colleagues, nothing could be more banal. But in reality? In the United States, the possibility for citizens to legally bet on the outcome of the presidential election became a reality with the decision, in mid-September, of the federal appeals court in Washington. In what is seen as a major reversal after nearly a century of prohibition, the court cleared the way for election betting by ruling that neither the Commodity Futures Trading Commission (CFTC), the watchdog in charge of regulate these markets, nor the public “suffer irreparable harm”.
This decision follows a dispute between the CFTC and the online betting platform Kalshi. The CFTC had attempted to block the reopening of Kalshi's betting, arguing that it would compromise the integrity of the electoral process. But the court decided otherwise. In his defense, Kalshi explained his approach by showing the importance of his markets, which offer crucial information on the odds of elections. Despite several attempts, the CTFC had not responded to our requests at the time of publishing this article.
Bets up to $100 million
Since this decision, Americans have already bet nearly $130 million, with Interactive Brokers and Kalshi leading this new market. As soon as trading opened in mid-September, more than 500,000 bets linked to the presidential election were traded on Interactive Brokers, while on Kalshi, player investments reached $300,000. THE New York Times reported that a Frenchman even bet more than $28 million on a Donald Trump victory via the Polymarket platform with four different accounts.
By adding up the different betting sites, bettors around the world have invested more than $2.85 billion. Huge ! Quoted by Wired magazine Steve Sanders, senior vice president of Interactive Brokers, commented on this growing demand, explaining: “The topic of politics is a very hot one for a lot of people. They have strong convictions one way or the other.”
Odds vary depending on the site
Odds vary greatly from platform to platform. As of October 25, for example, the site RealClearPolitics, which compiles odds from various bookmakers, placed Donald Trump in the lead with an average probability of 60% compared to 40% for Harris. On Polymarket, an offshore platform, Donald Trump has a rating of 65% compared to 35% for Kamala Harris. And according to Kalshi's site, the Republican has a probability of victory of 60% compared to 40% for his Democratic opponent.
And this attraction of punters raises strong ethical concerns, particularly among certain legislators. Interviewed by Wired, Oregon Democratic Senator Jeff Merkley described the decision as “a nightmare” that he said could be a way to manipulate public opinion by influencing perceptions of the likelihood of victory. “Think of this anonymous political power or this anonymous corporate power that says: 'Not only do we want this candidate to lose or this other one to win, but we are going to bet on the one we want to see win,'” he said. declared.
Influential supports for this decision
The Kalshi site has been able to gather influential supporters for its cause, including the Cato Institute, a right-wing think tank, and the trading company Susquehanna International Group, co-founded by Jeff Yass… one of Donald Trump's main donors . His support, along with that of the Cato Institute, played a key role in Kalshi's legal battle, including arguing that the CFTC was misinterpreting gambling laws by equating elections with gambling. chance.
Some observers then fear that big bettors, and especially powerful Trumpist financial supporters, could seek to manipulate the odds to create a snowball effect, indirectly influencing public opinion and the outcome of the election. According to these detractors, the Republican's supporters could use this by opposing them to the polls which are much closer and often to the advantage of Kamala Harris.
Still, for experts, betting markets offer a unique perspective on elections. And according to Koleman Strumpf, professor of political economy at Wake Forest University, they have the advantage of evolving more quickly than scientific polls. “In the 19th and early 20th centuries, these markets were huge,” he tells Wired magazine, adding that there is very little historical evidence of manipulation.
A more dynamic vision than surveys
Interviewed by Fortune magazine, Thomas Miller, a data scientist at Northwestern University and an expert in election forecasting, explains that “betting markets look into the future, and research shows that they are better than polls at predicting outcomes elections. » According to him, they more quickly capture developments in public opinion, influenced by debates, meetings and other media events.
However, despite their growing popularity, these bets do not replace traditional polls. Ryan Waite, vice president at consulting firm Think Big, told Fortune that the two tools provide complementary understanding of the political landscape. “Polls help us understand what different segments of voters think about candidates or issues, while prediction markets can provide a dynamic view of how the general public thinks things will turn out. Together, they provide a more complete picture of the political landscape,” he concludes. And who would you bet on? Donald Trump? Kamala Harris?
