Minors Trade Billions: US Prediction Markets Under Fire Over Underage Usage

A storm is brewing in the high-stakes world of online wagering that could threaten the foundations of the nascent prediction market industry. While platforms like Kalshi and Polymarket boast multi-billion dollar valuations, a sensitive demographic has come under the spotlight. An analysis by CNN has revealed that individuals under the age of 18 account for a shockingly high portion of the trading volume on these platforms. What is officially declared as trading in event contracts often turns out to be disguised sports betting upon closer inspection, which should be strictly off-limits for minors.

The debate centers on whether these platforms are merely offering modern financial instruments or if they have opened a backdoor to illegal gambling for teenagers. In the United States, the minimum age for sports betting is set at 21 in most states. Prediction markets argue that they are legally distinct from traditional gambling, but the boundaries are increasingly blurred. It is particularly critical that providers like Kalshi are now introducing combination trades, known in the industry as parlays, which significantly increase both risk and profit margins for operators.

Numbers and facts

According to the available data, the scale of trading by minors is massive. On Kalshi alone, users under 18 are reportedly responsible for approximately $5.4 billion in trades. Of this, a staggering $3.9 billion is attributed to contracts directly linked to sports events. These figures stand in stark contrast to the providers' claims that minors generate only a small fraction of turnover. While Kalshi reached a valuation of $22 billion in March 2026, its rival Polymarket is currently seeking a valuation of around $15 billion. For comparison, this would make Polymarket worth more than established industry giants like DraftKings or MGM Resorts International.

Rapid growth is also evident in quarterly figures. In the first quarter of 2026, total volume on Polymarket more than doubled compared to the previous quarter, with $10.6 billion traded in March alone. These platforms are attracting massive amounts of capital. For instance, the Intercontinental Exchange (ICE), the parent company of the New York Stock Exchange, has already invested around $600 million in Polymarket as part of a broader $2 billion commitment.

Background

The core of the problem lies in the psychological impact of these offerings. Experts warn that the platforms deliberately create a video-game-like atmosphere to attract young people. An article in the journal Science emphasized as early as April that the constant novelty and infinite streams of events eliminate natural stopping points for users. This encourages addictive behavior, which can have devastating consequences, especially for adolescents.

"They try to create this experience; it’s like a video game type experience, in pushing this on young people. Meanwhile, we know from the science that this is an extremely addictive product that causes incredible harm." - Les Bernal, National Director of Stop Predatory Gambling

Although Kalshi has been regulated by the Commodity Futures Trading Commission (CFTC) since July 2021, youth protection remains an open flank. Other players like Fanatics are more cautious and do not allow users under 21 on their prediction markets to avoid regulatory conflict. However, CEO Tarek Mansour vehemently defends his company, describing the products as superior to conventional betting.

Why it matters for German players

For German players, the situation is clear but nonetheless dangerous. Platforms like Kalshi or Polymarket do not hold a license from the Joint Gambling Authority of the States (GGL). Anyone betting on these sites from Germany is engaging in illegal gambling. The German Interstate Treaty on Gambling 2021 (GlüStV 2021) sets extremely high hurdles for player protection, which are simply ignored by U.S. prediction markets. This includes the strict deposit limit of 1,000 euros per month across all providers, monitored by the LUGAS system. The stake limit of one euro per spin for slots and strict identity checks to deter minors are also mandatory in Germany. German users should therefore check the official GGL whitelist to see if a provider is legal. Participating in unregulated prediction markets offers no legal protection for winnings and carries the risk of account suspension without warning.

What it means for GGL-licensed casinos

Licensed German operators must keep a close eye on this trend. The GGL will likely need to step up efforts to prevent access to such illegal third-country platforms via IP blocking or payment blocks. For legal casinos, the U.S. development serves as a confirmation of their own strict requirements. While Kalshi makes headlines with billions in turnover from minors, German providers prove through their connection to the OASIS lockout system that youth protection is the top priority here. The competitive disadvantage caused by the strict 1-euro limits in Germany is painful, but the current controversy in the U.S. shows how quickly a liberal system without effective age control can fall into disrepute. Reputable German providers often use such news to highlight their own commitment to safe gaming.