According to a study by the Coalition for Prediction Markets (CPM), a trade association representing regulated US prediction market operators, illegal offshore yes/no exchanges handled up to $34 billion in event contract trading volume from US users.
CPM’s Study Reveals Huge Volume Traded on Offshore Prediction Markets
The study was conducted in collaboration with Rutgers University professor Harry Crane, a specialist in sports betting and statistics. It found that US bettors and traders moved between $11 billion and $34 billion through unlicensed prediction markets from April 2025 to May 2026 alone, with nearly two-thirds of the volume linked to Polymarket.
According to CPM President Sean Patrick Maloney, the offshore and unregulated prediction market sector could reach $133 billion by 2030. If so, it could surpass the combined value of the US video game and recorded music industries. Maloney said the debate is not about whether prediction markets should exist, but whether they should be regulated domestically under federal oversight or continue to migrate to offshore platforms that host controversial markets involving death and war.
Speaking of what Melony said and considering the sector’s rapid growth, it shouldn’t be a surprise that the CFTC has been making new rules recently to strengthen its control over prediction market platforms.
While the CPM study does not examine why traders prefer offshore prediction markets, likely factors include access to crypto-native decentralized platforms such as Polymarket or Kalshi. Additional motivations may include lower trading friction, reduced margin requirements, greater availability of leverage, and a broader range of trading options.
Regulated Prediction Markets Are Actually Expanding Faster than Unregulated Ones
The CPM cautions that offshore prediction market volume could increase by roughly four times the upper bound of its April 2025–May 2026 estimate. However, it also notes that regulated markets are expanding more quickly than unlicensed ones.
Between 2024 and 2025, licensed prediction market operators grew 4.8 times faster than their unregulated counterparts. Meanwhile, offshore activity declined from 84% to 54% of total turnover, according to the study, suggesting a growing preference among US traders for regulated platforms.
Closing this gap is seen as significant for the industry, given the continued scale of offshore sports wagering. In 2025, regulated US sportsbooks recorded a combined handle of $168 billion, while some estimates place offshore wagering volume between $300 billion and $330 billion.
Among regulated US yes/no exchanges, Kalshi is by far the market leader in terms of share. Speaking of Kalshi, the company recently revealed a deal with Sportradar, a company that collects, analyzes, and distributes real-time sports data and statistics to media companies, sportsbooks, and betting platforms, sparking much debate in the industry.