The last few years have seen fans of political wagering make and lose millions placing bets with PredictIt – a website that has been allowing customers to place bets and win money on political outcomes since it started operation in 2014. Over the past years, some of the bets were literally easy money, especially when it comes to political “junkies”, bringing hundreds of thousands of dollars to such players by offering them a chance to monetize their political knowledge. Unfortunately for such punters, all bets on PredictIt may become unavailable soon.
According to reports, about 80,000 people use PredictIt. Most of them are only casual bettors, who simply place a few bucks on an election here or there. However, there are also thousands of people for whom the political gambling platform was more than just a hobby – it was a serious source of funds and more of a lifestyle. There have been users, called “super forecasters” who spend hours and hours reading political tip sheets and watching political predictions on television and online, and who sometimes spend massive amounts of money on a certain wager.
Of course, such betting behavior has raised interest, with various people commenting on the political “junkies” on PredictIt and discussing the unconventional bets they have been making for years.
Things got even more serious after the Covid-19 pandemic outbreak, as PredictIt opened a market for all kinds of unconventional wagers, such as whether the World Health Organization (WHO) would declare a global pandemic before March 6th, 2022, or whether Vladimir Putin would remain the president of the Russian Federation through 2022 following the beginning of the Ukrainian military invasion.
The Commodity Futures Trading Commission Seeks to Shut PredictIt Down
What makes PredictIt so interesting was also the way the betting platform works. The online gambling platform provides its users with the chance to purchase “shares” of a market, with them also being able to cash out anytime they want.
PredictIt and its way of operation have always been a legal anomaly to a certain extent. Betting on political outcomes is generally not allowed in the US but an exception can be made when it comes to such betting with non-commercial purposes. Apart from that, the online gambling platform has set certain limits – PredictIt customers are able to make bets of up to $850, and there can be no more than 5,000 people at a time in any of the markets available on the website. Furthermore, the platform cannot offer contracts on sports, or on certain events such as the supposed kidnapping or death of a person.
Unfortunately for the operator of the platform, the website’s way of operation and the betting options available attracted the attention of the competent authorities and the Government moved to shut down PredictIt in August 2022. The federal agency that regulates local markets – the Commodity Futures Trading Commission (CFTC) – has previously noted that the exchange could be allowed to operate as long as it was an “academic exercise”. However, it has now demonstrated a change of heart. According to the body, the political gambling platform could no longer offer new markets, and the existing ones would be forced to cease operation by February 15th, 2023.
The spokesperson of the Commodity Futures Trading Commission now said that the platform had grown to a point where they violated the terms of the letter.
The move saw political bettors panic, and some podcasts even sarcastically discussed the “imminent” and fatal end of the platform. The owner and creator of PredictIt has filed legal action arguing the order of the CFTC, claiming that the move to shut down the website was not right. The lawsuit also claims that shutting down the platform in mid-February would hurt thousands of users with so-called outstanding bets as these wagers will not be settled until after the February deadline.