Users report major losses on Polymarket and Kalshi amid prediction market boom

The rapid rise of U.S. prediction markets is bringing new warning signs. Two young users say they lost thousands of dollars on Polymarket and Kalshi in just a few weeks. As capital flows surge and audiences expand, experts are documenting a growing number of gambling-addiction cases – particularly among young men.

One user, Lorenzo Miro San Diego, discovered Polymarket after watching an episode of South Park. His first bet was profitable, but a series of sports and crypto event contracts left him with more than $1,700 in net losses. He noted the absence of control tools common on regulated betting platforms and filed a lawsuit seeking to recover part of his funds.

Another user – a 24-year-old engineer from Virginia – lost more than $10,000 in just eight days. He increased position sizes, took out loans, and kept opening new contracts until he “hit bottom” and deleted the app. He said Kalshi ads on social media pushed him to keep trying to recover his losses.

According to gambling-addiction specialists, young men are especially vulnerable to these platforms. Prediction-market activity often overlaps with crypto trading and retail stock speculation, and the absence of limits or warning mechanisms increases the risk of compulsive behavior.

Overall market activity is soaring. Kalshi, the largest U.S. platform, is estimated to have generated more than $260 million in fee revenue over the past year. Super Bowl betting volume reached $1 billion – 27 times higher than the year before. But researchers emphasize that most users lose money over the long run.

Experts warn that weak regulatory standards, minimal self-control features, and aggressive advertising create conditions for widespread financial harm. Some specialists are urging operators to publicly disclose risks and introduce self-limiting tools.

Despite heightened regulatory attention and the CFTC’s plans to develop rules for event contracts, the process could take a year or more. For now, the market continues to grow – along with the number of users facing addiction and significant losses.