Millions of Americans tuned in to the opening games of the new NFL season last week—and, more likely than not, a significant portion placed a bet. Whether those bets were placed through an online sportsbook (e.g. DraftKings or FanDuel) or a prediction market (e.g. Polymarket or Kalshi) raises questions for policymakers and regulators at all levels of government.
Last season, the American Gaming Association estimated that roughly $30 billion would be wagered on the NFL through legal US sportsbooks. Since then, betting on sports through prediction markets has grown rapidly, making that $30 billion estimate an increasingly incomplete measure of overall activity.
Urban analysis of a novel dataset consisting of 2.5 million trading accounts built by Akey and others shows that more than $600 million was spent on NFL events on Polymarket’s global platform from preseason kickoff in late July 2025 through Super Bowl LX in February 2026. Transaction volume increased steadily throughout the season, with $12 million spent through the platform during the first week of the regular season in September 2025 and $44 million spent during the Thanksgiving week peak.
These figures likely underestimate the amount of NFL-related activity on the platform because they include only international Polymarket users and Americans who masked their locations using VPNs. Early returns for the 2026 season show an upward trend in prediction market usage, much of it on platforms like Kalshi and Polymarket’s U.S. platform which fall outside our analysis.
With Polymarket legal for US residents for the full 2026 NFL season, consumers may spend even more on prediction markets this season. Already, usage has risen significantly, potentially causing downstream economic effects for states and consumers alike. As prediction markets increase access to sports betting, federal policymakers and regulators should ensure that both prediction markets and sportsbooks are subject to effective consumer protections and tax policies.
How much have prediction markets expanded access to sports betting?
As of April 2026, more than a quarter of Americans had a sports betting account, including more than half of adult men younger than 50. Urban research finds that 11 percent of US adults have bet on sports in the past year, whether through a sportsbook, prediction market, or other avenue.
Since the Commodity Futures Trading Commission (CFTC) approved Polymarket to operate in the US last November, prediction markets have greatly expanded the scale of sports betting. Our analysis of Polymarket data shows that almost 119,000 new wallets (i.e., accounts) traded on NFL markets for the first time in the 2025 season. Thousands of accounts joined the platform each week throughout the regular season and playoffs, reaching a peak of more than 10,000 new wallets during Super Bowl week in February.
What could prediction market use mean for consumer finances?
As prediction markets expand access to online sports betting and affordability challenges continue to strain household budgets nationwide, greater use of prediction markets this NFL season could coincide with greater rates of financial insecurity.
We know from prior Urban research that a significant minority of sports bettors report negative financial consequences, regardless of the betting channel used. Those who bet online or via mobile apps are more likely than those who bet in person to report saving less and missing bill payments, likely because online platforms facilitate a frictionless experience that enables more frequent betting, riskier financial choices, and problem gambling behaviors like loss chasing and microbetting.
Many states require sportsbooks to implement consumer protections, such as age verification requirements, advertising restrictions, self-exclusion lists, and gambling addiction treatment. But prediction markets are largely exempt from these requirements because they are regulated by the CFTC as financial instruments. Establishing uniform consumer protections regardless of channel would help safeguard more consumers against the potential negative financial effects of risky betting.
What does prediction market use mean for state and local budgets?
Since the Supreme Court lifted the federal prohibition on sports betting in 2018, 39 states and Washington, DC, have legalized the practice, negotiating with private companies or creating state-specific platforms for bettors. Legalized sports betting offers states a new, albeit risky, source of tax revenue.
Because prediction markets are federally regulated, they are not subject to the same tax treatment as state-regulated sportsbooks. New York offers a particularly consequential example of states’ fiscal exposure. In fiscal year 2026, online sportsbooks in New York generated $1.3 billion in state tax collections (PDF), which the state directed toward education, youth services, and problem gambling services. New York has the highest online sports gambling tax rate and collects the most tax from gambling of any state.
Urban analysis shows that if just 1 percent of New York’s sportsbook users switched to prediction markets, the state would lose about $13 million in tax revenue. This revenue erosion would reduce New York’s ability to address emerging needs or fund new policy priorities.
If the rise in prediction market use comes at the expense of sportsbook use, then 39 states and Washington, DC, may find themselves with new budgetary holes.
How can policymakers mitigate the negative economic effects?
The return of the NFL is a good reminder of how ingrained betting, no matter the avenue, has become in today’s sports. The league closely partners with sportsbooks, while prediction markets have announced deals with several teams and professional athletes, including LeBron James.
So far, the NFL has declined to partner with prediction markets. It also prohibits gambling advertisements on player jerseys and playing surfaces, and it limits gambling commercials to just one per quarter. However, if fans tune in to pregame analysis before any game this weekend, they’re still likely to see an ad for a betting platform every two minutes.
Amid this changing landscape, federal policymakers can preserve states’ ability to apply robust consumer protections to sports wagering, regardless of whether it occurs through a state-regulated sportsbook or a federally regulated prediction market. States should be able to require comparable safeguards across both channels, including consistent age restrictions, prohibitions on deceptive marketing and promotional practices, and limits on high-frequency transactions.
At the same time, states are pushing back against the emerging federal regulatory framework. Some states have pursued legal (PDF) and regulatory challenges involving sports-related prediction markets, and a bipartisan coalition of 44 state attorneys general submitted a formal comment to the CFTC arguing that the agency lacks authority over sports wagering offered through prediction markets. The coalition urged federal regulators to preserve states’ long-standing authority to regulate gambling, rather than allowing prediction markets to operate outside state regulatory frameworks.
As prediction markets continue to grow, Urban researchers are exploring questions about how these platforms affect people’s financial well-being and their implications for state and local tax revenues. With this future research, we hope to inform state and federal regulations that can ensure fans can enjoy sports without jeopardizing their, or their state’s, financial health.
We thank Jonathan Cohen at American Institute for Boys and Men for his expert review, and Pat Akey, Vincent Grégoire, Nicolas Harvie, and Charles Martineau for their construction of the Polymarket data set we used for this analysis.
