Prediction markets set for record growth in 2025, with 2026 midterm elections likely to be a key test

According to Odaily, the prediction market is expected to experience its largest year ever in 2025, with Polymarket and Kalshi emerging as industry leaders amid a surge of capital inflows, increased media attention, and multi-billion dollar valuations. As the 2026 U.S. midterm elections approach, the market generally believes this event could become a major trading opportunity similar to the 2024 presidential election. However, both companies will also face a critical test of whether they can prove the value of predictions at scale. The report points out that despite rapid growth in trading volume and user interest, the industry still faces controversies such as the authenticity of trading volumes, limited revenue scale, and unclear regulatory boundaries. Meanwhile, large platforms such as Robinhood and certain exchanges have successively entered the prediction market sector, further expanding user coverage. However, new contract forms such as sports betting and referenced markets have also raised potential regulatory and market manipulation risks. (The Block)