Prediction Markets: Casual Traders Bleed Cash, Pros Win Big

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Prediction Markets Hit New Milestones, but Most Traders Are Losing, WSJ Finds

Prediction markets, such as Kalshi and Polymarket, have become increasingly popular recently, attracting many new users. Last month, the total value of trades on these platforms reached a record $29.8 billion – a significant increase of about 588% compared to the same time last year.

I recently analyzed data from Polymarket, and the results are concerning. While the platform attracts many users, my research shows that over 70% of them are actually losing money. It paints a much different picture than initial impressions might suggest.

Prediction Market Profits Remain Concentrated

The report shows Polymarket has at least 2.3 million registered users. The Wall Street Journal analyzed 1.6 million of those accounts, focusing on activity since November 2022.

I was really surprised to see the data – it turns out a tiny fraction of users are making the vast majority of the profits. We’re talking about less than 2,000 accounts grabbing almost $500 million collectively, which represents a huge 67% of all the profits made. It really highlights how concentrated the gains are in this space.

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0.1% of accounts on Polymarket take home 67% of the profits, according to WSJ analysis

— Frank Chaparro (@fintechfrank) May 4, 2026

Most users are currently losing between $1 and $100. However, the 10% of users with the biggest losses have each lost around $4,000 on average.

The report found that most individual traders are losing money, while a few experienced professionals – particularly those with access to large amounts of data – are profiting from their losses.

A recent study examined data from November 2022 to March 2026 and found similar results: most Polymarket users – 68.8% – have lost money. A small group of traders – just 1% – have earned the vast majority of the profits, accounting for 76.5% of the total.

Bloomberg also reported that over 100,000 Polymarket accounts have each lost at least $1,000 since the start of 2025. This is almost twice the number of accounts that have made similar profits.

Losers Outnumber Winners on Kalshi

Kalshi reports that for every winner on its platform, there are 2.9 losing users, based on data from the last month. The company hasn’t shared the overall number of people using the platform.

An analysis of over 35,000 trades on Kalshi revealed that bets predicting a “yes” outcome, priced as having a 50% chance of winning, actually paid out closer to 40% of the time. This means people who made those bets consistently paid more than the actual odds justified.

People who quickly bet that a stock price will go up when they first see it—a typical behavior for individual investors—tend to lose about 11% of their money, according to the Wall Street Journal. Research from the University of Nevada, Las Vegas, suggests this is a worse outcome than playing most slot machines in Vegas.

BeInCrypto has contacted Polymarket and Kalshi for a statement and will add their responses to this article as soon as they are received.

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2026-05-04 07:46