Two-thirds of all Polymarket profits go to just 0.1% of accounts — and people are finding out the hard way

You can barely go an hour these days without the mention of prediction markets. Commercial ads are all over network and cable programming. Television news operations incorporate odds into stories. And, inevitably, someone at your office is happily crowing about an off-kilter bet they recently won.

On the surface, it might look like an easy way to make money. But like any form of gambling (though the prediction markets would strenuously object to that word), the losers greatly outnumber the winners.

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An analysis by The Wall Street Journal found (1) that 67% of profits on Polymarket, one of the leading prediction markets in the industry, go to just 0.1% of accounts. And of the 1.6 million accounts studied, more than 1.1 million were unprofitable.

Over on Kalshi, another popular marketplace, there are 2.9 unprofitable users for every profitable one.

John Pederson knows the pain of prediction markets. While recovering from a car crash, the 33-year-old former Outback Steakhouse line cook took to Kalshi to make ends meet. He took out a variable interest loan and started betting.

He did well at first, quadrupling his money to $8,000 by betting on snowfall totals in Detroit. That pot eventually jumped to $41,000 via sports bets where he used artificial intelligence to help with his predictions.

Then he decided to really roll the dice on mention markets, and bet all of his winnings on a single bet that a celebrity would say a specific word on TV. They didn't, and he lost it all.

Mention markets are a fast-growing niche within the prediction market world. In January, mention markets saw $117 million in trading volume on Kalshi. They took in just $22,000 (2) in January 2025. (Polymarket's mention market volume is even higher.)

That rise comes despite the fact that they're easily susceptible to abuse, as insiders (such as staff or members of an audience in pre-recorded shows) might know what will be said in advance.

Last October, Coinbase CEO Brian Anderson cited prediction markets on the company's earnings call and began reciting a list of words.

"I just want to add here the words bitcoin, Ethereum, blockchain, staking and Web3 to make sure we get those in before the end of the call," he said.

(He later said he was joking (3) and hadn't made any bets ahead of the call.)

More recently, a soldier in the U.S. Special Forces was charged with using classified intel about the mission to capture former Venezuelan leader Nicolás Maduro to place a wager on Polymarket and win north of $400,000.

While prediction markets have found a more favorable reception in Washington since President Trump took office, it's not all smooth sailing for them.

The U.S. Securities and Exchange Commission, on Monday, delayed (5) the launch of the first exchange-traded funds (ETFs) linked to prediction markets proposed by Roundhill Investments, GraniteShares, and Bitwise. Regulators are requesting more information about the structure of these ETFs and want more investor disclosures.

The delay came as Sen. Chuck Schumer (D-NY) called (6) on the White House and U.S. House of Representatives to ban government officials from placing bets on prediction markets (something the Senate has already done).

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The Wall Street Journal (1),(2); Yahoo Finance (3); U.S. Department of Justice (4); Reuters (5); The Hill (6)

This article originally appeared on Moneywise.com under the title: Two-thirds of all Polymarket profits go to just 0.1% of accounts — and people are finding out the hard way

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