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Happy Wednesday everyone, here’s todays top stories…
Bloomberg's Washington Edition newsletter published the most complete volume picture we've seen yet…
Kalshi trading spiked to more than $41 billion in contracts in July, up from just $9.5 billion in January. Polymarket's July volume was $7.9 billion, with its separate US exchange adding another $4.9 billion. Kalshi has established itself as the dominant prediction market by volume — by a wide margin. The World Cup drove a significant share of the summer surge, with sports markets remaining the most active category on both platforms alongside political markets. The chart below shows the trajectory. January to July. $9.5 billion to $41 billion. No signs of slowing down…
This is big. Synth Data published research showing that Kalshi YES-price changes over a 2-second window predict subsequent Binance BTC returns 0-10 seconds later, with the correlation strengthening from 0.036 in January to 0.173 in August.
The interpretation is that sophisticated HFT participants are no longer just reacting to spot price. They're forecasting the next few seconds of BTC using order-book microstructure, cross-exchange flows, and proprietary signals — then expressing that forecast on Kalshi first. Capital moves the prediction market price before the move prints on the exchange. The classic information flow has inverted: it used to be Binance → model → Kalshi. Now it's proprietary signals → HFT forecast → Kalshi → future Binance price. Kalshi has effectively become a real-time, capital-weighted ensemble of short-horizon forecasting models. Worth watching whether the edge scales with volume or gets competed away.
Kalshi's Head of Enforcement and a Wharton accounting professor co-authored a piece for the Harvard Law School Forum on prediction market surveillance… The core argument is that equity market surveillance principles don't map cleanly onto prediction markets because of a fundamental structural difference. In equities, nobody knows with certainty where a stock will trade — MNPI influences price but doesn't determine it. In prediction markets, the outcome IS the price. Someone who knows the Fed is cutting before the announcement doesn't have to guess how markets will react. They just buy YES. That makes prediction markets uniquely vulnerable to insider trading — and uniquely challenging to surveil. The piece is the most serious public treatment of prediction market market integrity published by an active industry participant. The fact that it appeared on the Harvard Law Forum is probably itself a signal about where this industry sees itself going.
Novig has now sued officials in five states since August 4. The latest being Wisconsin, where the sports-focused prediction market filed a federal lawsuit against the Attorney General and gaming administrator in anticipation of being forced to stop offering sports event contracts.
Novig began offering contracts to Wisconsin residents one week before filing the suit and is seeking expedited consideration of a preliminary injunction. The Mets partner is not waiting for regulators to come to them. Talk about taking the offense!
Citigroup just told clients how to trade the midterm elections using Polymarket as the primary input… Polymarket prices a 48% chance of a full Democratic sweep, with 38% expecting a split result. Citi's bond call: divided government means lower yields, curve-flattening, and a post-election Treasury rally. Cyclical tech outperforms. Defensive healthcare and consumer staples underperform. A Wall Street bank is now publishing client notes where the primary forecasting source is a prediction market platform.
Most professional sports teams are still sitting out prediction market partnerships (and the wait could last until 2028). The Mets and Yankees are the only two major US sports teams to have signed prediction market deals. The NBA and NFL are in wait-and-see mode. American University gaming professor Matthew Bakowicz explained why: "Fear of the fact that there's uncertainty in how the market is going to be regulated, and for many of these owners they have business interests outside of their own state and internationally." The court system won't deliver clarity until at least 2028. Teams that wait that long will be late to a market that's already moved.
Baltimore City sued Kalshi and Polymarket last week for alleged illegal sports betting. Mayor Brandon Scott and the Baltimore City Council filed separate consumer protection actions in Baltimore City Circuit Court, alleging the companies offer unlicensed sports wagering while misleading consumers about the legality and regulatory status of their products. Baltimore joins New York State, New York City, Washington State, Wisconsin, and a growing list of jurisdictions taking direct legal action against the platforms. The lawsuit map is expanding faster than the federal preemption argument can contain it.
How Jennifer Aniston’s LolaVie brand grew sales 40% with CTV ads
For its first CTV campaign, Jennifer Aniston’s DTC haircare brand LolaVie had a few non-negotiables. The campaign had to be simple. It had to demonstrate measurable impact. And it had to be full-funnel.
LolaVie used Roku Ads Manager to test and optimize creatives — reaching millions of potential customers at all stages of their purchase journeys. Roku Ads Manager helped the brand convey LolaVie’s playful voice while helping drive omnichannel sales across both ecommerce and retail touchpoints.
The campaign included an Action Ad overlay that let viewers shop directly from their TVs by clicking OK on their Roku remote. This guided them to the website to buy LolaVie products.
Discover how Roku Ads Manager helped LolaVie drive big sales and customer growth with self-serve TV ads.
The DTC beauty category is crowded. To break through, Jennifer Aniston’s brand LolaVie, worked with Roku Ads Manager to easily set up, test, and optimize CTV ad creatives. The campaign helped drive a big lift in sales and customer growth, helping LolaVie break through in the crowded beauty category.
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