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Happy Monday, everybody.
The Ninth Circuit ruled that sports prediction-market contracts are gambling—not federally regulated trading. Guess what happened next? DraftKings jumped 10%, while Flutter rose 8% on the news.
The court’s core finding: sports-event contracts offered by prediction-market platforms are sports bets, not swaps subject to federal commodity law.
That could make it easier for Nevada to apply its gaming regulations to Kalshi, Crypto.com, and Robinhood. And it could give other states a roadmap to make similar arguments.
Trouble ahead? Maybe.
Prediction markets are getting harder to beat. CNBC highlighted research from a Yale economist analyzing $13.76 billion in Polymarket trades.
The finding: just 3% of accounts captured 27% of all dollar profits, consistently moving prices toward correct outcomes before the broader market caught up.
As more institutional capital enters and professional liquidity deepens, that 3% is expected to shrink below 1%.
“I think it’s only going to be the very, very best, say hedge funds, that are able to beat prediction markets,” the economist said.
The good news for smaller traders, according to the article, is that large institutions face scale constraints in thin markets. A relatively small order can move the price enough to evaporate an institution’s own edge, meaning niche markets and specialized expertise may still offer a genuine advantage.
But take a step back: does the author understand how hedge funds make money?
Look, it makes little sense for a hedge fund to devote serious resources to thin markets. There is limited capacity. Yes, a fund may find an edge, but if it cannot deploy much capital without moving the market against itself, the upside is limited.
Next…
Tonight’s game
🏈 TONIGHT: BRONCOS vs. CHIEFS
Monday Night Football. Week 1. Mahomes versus Denver.
Here is what the whale consensus looks like as of 8:00 a.m. More trades will come in throughout the day before kickoff, so these numbers could change.
Whale consensus: UNDER—but the story is in the breakdown.
OVER: +$140.7K in net capital — 11 whale buys, 0 sells
UNDER: +$161.7K in net capital — 6 whale buys, 0 sells
More whales bought the Over: 11 of them.
But the six whales on the Under have put up more money—$161.7K across six trades, versus $140.7K across 11 trades on the Over.
The Under whales are fewer but bigger.
The Over whales are more numerous but smaller.
That is why the consensus direction is Under: not because more whales are on it, but because more net capital sits on Under.
Disclosure: I hold a $55 position on Under 44.5 in Broncos–Chiefs. This is a small personal position and not a recommendation to buy, sell, or trade the contract.
This is the intricacy of the consensus: PMW weights capital, not headcount.
However, there is one interesting historical wrinkle…
The first Week 1 Monday Night Football game has generally produced offense.
Across the 19 completed seasons from 2007 through 2025, 13 first Monday-night games went over 43.5 points.
That is 68.4%.
The average total was 49.4 points, and the median was 50.
Also, there is a reasonable theory that the NFL wants Monday night to feel like an event.
So it does not pick a random game.
It puts star quarterbacks, recognizable teams, rivalries, and matchups with built-in drama in the window.
That does not guarantee a shootout, football does not work that way.
But it may help explain why the first Monday night game of Week 1 has historically leaned toward points.
It does not override the current market, the matchup, injuries, pace, or the whale-capital signal.
Bottom line is the long-run Week 1 Monday-night sample leans Over, while the largest whale positions this morning lean Under.
That is exactly why watching the consensus change before kickoff matters.
But it is still only 8:00 a.m. The game is tonight, and more capital will come in throughout the day.
I’ll be watching the agreement and confidence scores move as kickoff approaches and informed money settles.
Check Prediction Market Whales for updated consensus numbers as trades develop today.
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